The new kid on the investment block is retailing of government securities. With the equity markets passing through a bear phase, there is a sudden spurt in debt markets. Investor may stay with gilts and fancy with the glitters of gilt.In the recent past, Indian debt market has witnessed unprecedented growth and volatility. With the growing uncertainties and inherent risks of investing in the share market, investors-large, medium and small have identified debt market as well as gilts as an avenue for maximization of returns, through fixed income and capital gains arising out of price-yield movements. With the arrival of FIIs and foreign funds in search of investment opportunities, the Indian debt market is poised for multidimensional growth and integration into the global market. With equity markets in doldrums, investors are burning their fingers by investing in a number of instruments, which promised sky-high returns but failed to return even their investments. It is obvious now that investors are now looking for better alternatives.
In liberalized financial system, the changes in the shape of the yield curve and also the relative shifts in the yield curve have come to signify the market expectations about real sector activity and inflation rates. Debt market is vital for financial market efficiency. The Indian debt market or fixed income securities market constitutes three segments viz., government securities market (Gilts), PSU bonds market and corporate securities market. However, the major focus in the development of debt market has been on the Government securities market because it is a principal segment of the debt market, a market for sovereign paper. It has a role in setting benchmarks in the financial markets as a whole. Presently, gilts form the largest chunk of debt market in India.
|
