Do you know you can buy tax free bonds and certain public listed bonds on NSE BSE like you buy equity?
Traditionally, investors buy bonds either in primary or from broker in secondary market. If you are looking to invest any amount less than 4-5 Crs, you can increase your IRR following below methods:
1. Buy from secondary market instead of primary market:
Most of the public issues, there’s hidden charges. In primary, there’s brokerage for the arranger and generally liquid bonds get listed at discount. This is true only for bonds lower AAA rated. If bonds are AAA rated by reputed agencies, there’s a good demand for these bonds and post listing, they trade at premium. But if issues are less than AAA, arranger fees range from 0.5% to 2% depending on tenure and investors can get bonds at discount post issuance.
2. Buy from NSE/BSE screen before buying from brokers
Below are two links given for NSE and BSE. On this you will find, liquid bonds which are available for trading. Many of these are tax free bonds. Generally, tax free bonds on these platform trade at a premium or discount. Before buying from any intermediary, do check these links. Please note the prices are inclusive of interest due till date.
https://www.nseindia.com/market-data/bonds-traded-in-capital-markethttps://www.bseindia.com/markets/debt/debt_corporate_EOD.aspx?curPage=1
Disclaimer: All above is true for small amounts ranging from One thousand to 4-5 Crs. If you are looking to invest amount larger than 5 crs, you will need to stick to primary market or broker for secondary market.