What financial experts think about RBI’s new window for retail investors to buy-sell govt bonds
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Synopsis
Encashing direct investments in gilts quickly could be more difficult than encashing gilt mutual fund units. Direct investment in Gilts can be considered by someone looking for safety of investment of the highest level and who is willing to remain invested till maturity of the instrument.
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RBI’s move to allow retail investors to open gilt investment accounts directly will hopefully make it easier for retail investors to invest in government securities than at present. The attraction of government securities is the sovereign guarantee that they offer. This needs to be viewed in the light of the fact that bank FDs are insured only up to Rs 5 lakh with the Deposit Insurance and Credit Guarantee Corporation (DICGC) and do not offer sovereign guarantee which is the safest possible for a financial instrument in the country. However, liquidity offered by