Latest news with #GBI-EM
Time of India
5 days ago
- Business
- Time of India
JPMorgan considers cutting China, India share in EM Bond Index
JPMorgan Chase & Co. is considering cutting the weight of the largest bond issuers in its flagship emerging-market index — including China and India — as it seeks to reflect a broader range of developing-nation debt. The Wall Street bank has been soliciting feedback from clients on amendments to its GBI-EM Global Diversified index, the benchmark for local-currency developing-nation debt that's tracked by more than $200 billion of funds, documents seen by Bloomberg show. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cheras: SUV Sale, Click Here to See Prices Luxury SUV Deals | Search Ads Search Now Undo One of the proposals envisages lowering a cap on individual countries from 10% to 8.5%, a move that could increase the average yield of the benchmark as nations with higher borrowing costs gain a bigger presence, according to the documents. While a loftier yield implies greater risks, it also means higher potential returns. Bonds Corner Powered By JPMorgan considers cutting China, India share in EM Bond Index JPMorgan is considering lowering the country cap in its GBI-EM index from 10% to 8.5%, potentially reducing China and India's weight while boosting smaller emerging markets. The proposal aims to diversify exposure and enhance index yield. Sebi's bond central to deepen corporate bond market, improve price discovery: Vineet Agrawal ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh India's Rs 50 lakh crore bond market grows, but retail investors still sit on the sidelines: Experts Adani Enterprises' Rs 500-crore NCD issue oversubscribed 3x Browse all Bonds News with The amendments are preliminary proposals, the documents show, and are not guaranteed to be adopted. In a consultation last year, JPMorgan initially floated a methodology change which would have resulted in China's index share falling to 6%, only to later withdraw the proposal. If the latest amendments are implemented, however, the weighting reductions would affect the largest bond sellers in emerging markets, including Indonesia, Mexico and Malaysia, as well as China and India, according to the documents. Brazil, South Africa, Poland and Colombia would be among the biggest beneficiaries, they show. Live Events Frontier Gauge JPMorgan is also previewing a new frontier local markets index, with $344 billion of debt across 521 bonds eligible, according to the documents. The new frontier gauge would cover 21 markets across 20 currencies. A spokesperson for JPMorgan declined to comment when contacted by Bloomberg. JPMorgan's index is the main benchmark for developing-nation debt funds and changes to its composition can affect global investment flows . Chinese bonds were phased into JPMorgan's indexes in 2020 while Indian debt was added last year. Bloomberg LP, the parent company of Bloomberg News, also offers index products for various asset classes through Bloomberg Index Services Ltd.
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Business Standard
29-06-2025
- Business
- Business Standard
Front-loaded, then flat: JPMorgan Index fails to sustain FAR bond inflows
Mumbai Listen to This Article Foreign inflows into India's Fully Accessible Route (FAR) government bonds following the phased entry into JPMorgan's GBI-EM index have fallen well short of projections so far. When JPMorgan announced in September 2023 that Indian bonds would be phased into the index starting June 28, 2024, and reaching the full 10 per cent weighting by March 31, 2025, at 1 per cent per month, analysts predicted passive inflows of $20 billion - $25 billion, with bullish scenarios extending up to $30 billion, including active repositioning. However, between June 2024 and March 2025, total foreign purchases under the FAR route had reached just ₹1.09 trillion, which is
Economic Times
04-06-2025
- Business
- Economic Times
FD interest rates are falling: Can corporate bonds offer better returns with safety?
Getty Images Corporate bonds have become an important part of a diversified portfolio of investors who have the required risk appetite. As a tool of personal investment, corporate bonds have become the difference between reactive investing and proactive wealth building. Serving both the purposes of income generation and portfolio diversification, corporate bonds offer higher return than FDs however at a relatively higher risk. Capital allocation skewed after the 2010s equity boom, where bonds assumed a central role. Today, the bond market in India surged to $2.6 trillion, of which $1.3 trillion, or 45%, is made up of corporate bonds. Corporate bonds have been benefitting from the headwinds of companies allocating a higher debt component than equity, foreign investors betting on Indian debt, and retail investors finally having a seat at the table. With the RBI cutting the repo rate to 6%, its second consecutive repo rate cut in 2025 from the earlier 6.25% in February 2025, borrowing has become cheaper than issuing equity, allowing companies to raise capital without diluting ownership. Simultaneously, global investors are pouring money into Indian bonds, drawn by yields of 7-8%, far outpacing developed markets. India's inclusion in JPMorgan Government Bond Index-Emerging Markets (GBI-EM) is set to attract $20-25 billion in foreign capital by 2025. Additionally, retail investors, too, are benefiting from SEBI's reforms, lowering corporate bond entry barriers to INR 10,000. These currents have propelled corporate bonds to become an important part of a diversified portfolio of investors who have the required risk appetite. With easy online access and tax-efficient options, corporate bonds enable - Inflation is parasitic to your investment portfolio as well as purchasing power. While inflation has moderated in recent quarters, India's structured realities of a large populus, constrained capital base, and reliance on imported commodities mean that inflationary pressures are likely to persist. This is where investors can rely on the right kind of corporate bonds to beat inflation, maintain real returns and protect their portfolios. Achieving FIRE (Financial Independence, Retire Early) requires a balance between growth, income stability, and risk management. Corporate bonds, with their varying risk levels, offer a structured way to generate passive income, preserve capital, and hedge against market bonds from stable companies provide fixed income with minimal market fluctuation. Mid-range bonds offer higher returns with moderately higher risk, creating a middle ground between conservative and aggressive investing. High-yield bonds can boost returns however come at very high risk, they should be limited to 10-15% of an investment portfolio to manage key is to diversify with different ratings, to coat your portfolio from macroeconomic swings, while generating steady income. Inflation-protected bonds add an extra layer of security by maintaining purchasing power over time. This approach isn't about getting rich quickly but building a sustainable financial strategy that supports long-term wealth accumulation and reduces dependency on traditional employment is the time of your life when you have zero active income, but your expenses are far from halting. Around 70% of senior citizens in India are dependent on their families for maintenance. 78% of them do not have pension coverage. An effective retirement-ready portfolio offers steady income, corpus protection, and inflation-beating returns. For this purpose, Senior secured bonds work well. Senior secured bonds are low-risk debt securities issued by corporations to raise capital while working towards investor protection. These bonds are backed by specific collateral assets such as real estate, cash, or other valuable holdings, reducing default priority ranking over unsecured or subordinated bonds ensures investors receive payments first in case of liquidation of the bond issuing company. These bonds offer fixed interest payments and lower volatility compared to stocks and mutual funds, making them an option for investors who intend to avoid risk related to unsecured debt as they age. A dedicated corpus to corporate bonds acts as stabilisers in your portfolio, offsetting potential losses in the stock market. Every investor's journey comes with landmines. From interest rate fluctuations that can deflate bond prices, credit risks lurking in lower-rated securities, to the treacherous terrain of liquidity that can trap your capital. These are not warning signs to retreat, but challenges to navigate money does not shy away from complexity, it masters it. From risk-averse retirees to ambitious wealth builders, these instruments offer a tailored approach to wealth accumulation. While equity markets swing wildly, bonds are an anchor that ensures steady income, protects purchasing power, and offers a lifeline when market volatility threatens to sink your portfolio's ship.
Time of India
04-06-2025
- Business
- Time of India
FD interest rates are falling: Can corporate bonds offer better returns with safety?
As a tool of personal investment , corporate bonds have become the difference between reactive investing and proactive wealth building. Serving both the purposes of income generation and portfolio diversification, corporate bonds offer higher return than FDs however at a relatively higher risk. Capital allocation skewed after the 2010s equity boom, where bonds assumed a central role. Today, the bond market in India surged to $2.6 trillion, of which $1.3 trillion, or 45%, is made up of corporate bonds. Corporate bonds have been benefitting from the headwinds of companies allocating a higher debt component than equity, foreign investors betting on Indian debt, and retail investors finally having a seat at the table. With the RBI cutting the repo rate to 6%, its second consecutive repo rate cut in 2025 from the earlier 6.25% in February 2025, borrowing has become cheaper than issuing equity, allowing companies to raise capital without diluting ownership. Simultaneously, global investors are pouring money into Indian bonds, drawn by yields of 7-8%, far outpacing developed markets. India's inclusion in JPMorgan Government Bond Index-Emerging Markets (GBI-EM) is set to attract $20-25 billion in foreign capital by 2025. Additionally, retail investors, too, are benefiting from SEBI's reforms, lowering corporate bond entry barriers to INR 10,000. These currents have propelled corporate bonds to become an important part of a diversified portfolio of investors who have the required risk appetite. With easy online access and tax-efficient options, corporate bonds enable - Beating Inflation Inflation is parasitic to your investment portfolio as well as purchasing power. While inflation has moderated in recent quarters, India's structured realities of a large populus, constrained capital base, and reliance on imported commodities mean that inflationary pressures are likely to persist. This is where investors can rely on the right kind of corporate bonds to beat inflation, maintain real returns and protect their portfolios. Live Events Achieving FIRE Status Achieving FIRE (Financial Independence, Retire Early) requires a balance between growth, income stability, and risk management. Corporate bonds, with their varying risk levels, offer a structured way to generate passive income, preserve capital, and hedge against market downturns. Low-risk bonds from stable companies provide fixed income with minimal market fluctuation. Mid-range bonds offer higher returns with moderately higher risk, creating a middle ground between conservative and aggressive investing. High-yield bonds can boost returns however come at very high risk, they should be limited to 10-15% of an investment portfolio to manage risk. The key is to diversify with different ratings, to coat your portfolio from macroeconomic swings, while generating steady income. Inflation-protected bonds add an extra layer of security by maintaining purchasing power over time. This approach isn't about getting rich quickly but building a sustainable financial strategy that supports long-term wealth accumulation and reduces dependency on traditional employment income. Retirement Planning Retirement is the time of your life when you have zero active income, but your expenses are far from halting. Around 70% of senior citizens in India are dependent on their families for maintenance. 78% of them do not have pension coverage. An effective retirement-ready portfolio offers steady income, corpus protection, and inflation-beating returns. For this purpose, Senior secured bonds work well. Senior secured bonds are low-risk debt securities issued by corporations to raise capital while working towards investor protection. These bonds are backed by specific collateral assets such as real estate, cash, or other valuable holdings, reducing default risk. Their priority ranking over unsecured or subordinated bonds ensures investors receive payments first in case of liquidation of the bond issuing company. These bonds offer fixed interest payments and lower volatility compared to stocks and mutual funds, making them an option for investors who intend to avoid risk related to unsecured debt as they age. A dedicated corpus to corporate bonds acts as stabilisers in your portfolio, offsetting potential losses in the stock market. Bonds aren't risk-free but they are smarter Every investor's journey comes with landmines. From interest rate fluctuations that can deflate bond prices, credit risks lurking in lower-rated securities, to the treacherous terrain of liquidity that can trap your capital. These are not warning signs to retreat, but challenges to navigate strategically. Smart money does not shy away from complexity, it masters it. From risk-averse retirees to ambitious wealth builders, these instruments offer a tailored approach to wealth accumulation. While equity markets swing wildly, bonds are an anchor that ensures steady income, protects purchasing power, and offers a lifeline when market volatility threatens to sink your portfolio's ship.
