Are NCDs safe investments?
Although NCDs are considered safe investments for retail investors, they should always look into the credibility of the issuing company before investing.
Secured non-convertible debentures are backed by the company's assets, which makes that low risk. If the corporation fails to honour the obligations of the NCD, the debenture holder can have a claim on the company's assets to recover his investment. But unsecured NCDs don't come with such protection, and in case of bankruptcy, the debenture holder can't raise a claim against the company.
Retail investors need to understand the risks before investing.
Related Articles
What are the things to consider before investing in NCDs?
"Ratings: Rating agencies use simple alphanumeric symbols to convey credit ratings. For example, rating agencies assign credit ratings to debt obligations on three basic scales: the long‐term scale, the short‐ term scale, and the fixed deposit scale. ...
What is public issue of NCDs and ISIN?
All Non-Convertible Debentures (NCDs) issued through Initial Public Offer gets listed on the Capital Market segment of the Exchange. Every security in the trading system is given a symbol with series representative of the security (ISIN).
Is Demat account necessary to invest in these NCDs
Having a Demat account to invest in NCDs is essential as most debentures are issued in dematerialised mode. Open a free Demat account with IIFL Securities in under five minutes and invest in various financial instruments from the app.
How do client track profit & loss of his investments and trades?
After client login to his IIFL Markets App, he can find "Portfolio" on the bottom navigation menu. This page has 3 tabs: Holdings - For the stocks that client has purchased and are present in his/her Demat account. Client can check Today's total Gain ...
How client can search for NCDs?
Client have to type the name for his desired NCD, for eg, "IIFL NCD", and get his desired results.