How to invest in Bharat Bond ETF?

Bharat Bond ETF is an exchange-traded scheme that invests the corpus in bonds issued by Central Public Sector Enterprises (CPSEs), Central Public Sector Undertakings (CPSUs), Central Public Finance Institutions (CPFIs) and other government organisations of AAA credit rating. The maturity of the bonds is close to the maturity period of the fund. Here is how one can invest in Bharat Bond ETF:

Requisites

Any resident Indian, non-resident Indian, or non-individual (company, firm, HUF etc) can invest in Bharat Bond ETF. One can invest in the ETF only if he/she has a trading and demat account.

Investment options

Investors have two maturity options to choose from:

• Short term with a maturity period of 3 to 5 years.
• Long term with maturity period of up to 10 years.

Withdrawal process

Though the fund has a different maturity period, there is no lock-in period for the investors as the fund is traded on the exchange. If the investor wishes to withdraw investment, he or she can sell the units on the exchange at the applicable price.

Points to note

• Investors also have the option to invest in Bharat Bond funds directly with the fund house by investing in the Bharat Bond Fund of Fund scheme.
• Though the fund invests in bonds issued by government companies, it does not guarantee any kind of assured returns.

(Content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)