Global fixed income fund: what is it and how to invest?
What is a global fixed income fund? Learn everything about it!
Announcements
The global fixed income fund (AF Global Bonds) is now available on the XP Investimentos platform.
Since its inception in August 2021, the fund has accumulated a return of 200% of the CDI.
For this reason, it is a great option for global diversification through fixed income assets, as it contains international assets.
To learn more about the subject and forms of investment, continue reading.
What is the global fixed income fund?
AF Global Bonds, managed by AF Invest, is an option for diversifying global assets through fixed income.
Therefore, it is a fund intended for people who are classified as qualified investors.
The fund's allocation is well diversified, as it is made up of companies from the finance, electricity, health, sanitation, logistics sectors, among others.
To invest in this fund, it is necessary to make a minimum application of R$ 1 thousand.
Its performance fee is 20% of what exceeds 100% of the CDI.
The administration fee is 0.50% per year on net equity, which may reach a maximum of 0.75% for the same period.
Source: Value Invest
What are the main features of this fund?
One of the main advantages of AF Global Bonds is that there is no exchange rate variation on profitability.
Furthermore, this fund has the return of assets that make up the portfolio.
What are international funds?
International income funds have their investments linked to some foreign currency.
The assets that make up this fund are traded outside of Brazil. For this reason, the profitability is released in foreign currencies.
Obviously, this can be an advantage considering the country's current economic scenario.
If you invest in funds, you won't have much difficulty investing in international funds. After all, the process is similar to investing in funds from other categories.
You will invest in shares and will have the assistance of a professional manager to manage the fund.
What are fixed income funds?
To better understand the subject, it is very important that you know exactly what fixed income funds are.
Basically, a fixed income fund works like a safe investment portfolio with low fluctuation.
This category includes portfolios that have at least 80% of equity invested in assets linked to variations in interest rates, price indexes, or both.
To obtain this type of exposure, the funds invest most of their assets in fixed income assets.
International fixed income funds
International fixed income funds are those that invest the majority of their assets in fixed income products from other countries.
Generally, these are funds focused on rich or emerging countries.
One of the most interesting features of this investment is that it is linked to the Interbank Deposit Certificate (CDI) and exchange rate variations.
Furthermore, as we are talking about fixed income, it is important to mention that this option is very advantageous for investors with a more conservative profile, that is, those who do not want to take risks.
What are the advantages of investing in fixed income funds?
Among the main advantages of investing in fixed income funds, we can mention:
1. Professional management
Calculating risk and understanding the volatility that each security can experience are difficult tasks, even for more experienced investors.
The advantage, in this case, is that fund managers are professionals who are experts in this type of analysis.
For this reason, they carry out quality work in relation to risk analysis, volatility and issues related to the sale of the security.
2. Practicality
Monitoring the diversification of your investment portfolio is a task that requires time and dedication, as well as a lot of knowledge.
When investing in fixed income funds, it will be easier to monitor performance, as with just one statement, you will have access to all the information you need.
It is also important to mention that you will invest in securities from different companies, but without having to open accounts with several brokerage firms or investment banks.
What is the main disadvantage of fixed income funds?
Regarding the disadvantages, we can mention the fees involved in the operations.
In addition to Income Tax and IOF, fixed income funds charge management and performance fees.
These costs, in addition to the investor profile and financial objectives, must be analyzed.
How are fixed income funds taxed?
The taxes that apply to fixed income funds are Income Tax (IR) and Tax on Financial Transactions (IOF).
However, IOF is only charged if the redemption is made within a period of less than 30 days from the application. In this case, the rate on the income varies from 96% to 0%, according to the term.
Income Tax is levied on the profitability of the funds. The longer you hold the investment, the less tax you will pay.
For short-term investments (with maturity of up to 365 days), if the investment is for up to 180 days, the rate will be 22.5%.
If the term is longer than 180 days, the rate decreases to 20% on the amount contributed.
For long-term fixed income funds, the regressive IR table works as follows:
•Up to 180 days, 22.5%;
• 181 to 360 days, 20%;
• 361 to 720 days, 17.5%;
• Over 720 days, 15%.
How to invest in a fixed income fund?
It is necessary to look for institutions that distribute funds, such as stockbrokers.
For example, the AF Global Bonds fund is available on the XP Investimentos platform.
In addition, it is necessary to study the investment policy and analyze the fund's performance history.
Conclusion
In general, the global fixed income fund, like other funds in this category, is a good investment for conservative and moderate profiles.
Even for those with little experience, these funds are recommended, as they are a relatively simple way to make investments.
