With this turmoil in the Brazilian economy, caused by increased inflation, increase in the basic interest rate (SELIC), increased recession, reduction of the primary surplus target, low popularity of President Dilma, do dollar increase, low commodity prices, Operation Lava Jet and many other political variables, the question I ask is: what better application in fixed income to preserve my money? This post will present you a worksheet to assist you in this decision.
Many criticize saying that fixed income does not yield anything and that we should focus on equity, but the current volatility of the stock exchange filters investors less prone to high risks. It remains faithful only those professionals who prefer to speculate in the difficult level, They are trying to achieve some advantage that the crisis might bring.
Of course, there are people making money from the stock market, but as I am not professional equity, and the current situation is very favorable for investments in fixed income, I decided to write this post, provide the spreadsheet free download, and help you choose the best application for your money.
The idea to write this post came about after I received an e-mail João Sandrine, editor in chief of the site InfoMoney, indicating Article “What is the best CBD or public title: Pre, post or indexed to inflation?“. In this article the Sandrini offers a simplified spreadsheet that also helps in choosing the best investment in fixed income.
I lowered his spreadsheet decided to supplement with some important information. I venture to say that was better than the original. Interestingly, I had detected errors in two formulas of the spreadsheet InfoMoney, which were promptly corrected after the informed. See the images:
My review of the error in the spreadsheet InfoMoney
E-mail InfoMoney correcting the spreadsheet
After curiosities, we go to the explanation of how to use this free spreadsheet that complementei.
What is the best application in income currently fixed?
The simplest answer to this question is: one that offers you the best conditions. For this you will need to check the banks account, or their brokerage firms, what options being offered.
When we compared a CBD title of a bank, CBD with a title of another bank, both being indexed by CDI and with the same maturity dates, It is easy to know the best only looking at the percentage of return. A CBD that pays 110% CDI is better than what you pay for 90% do CDI, some? sure, but when we try to compare between different types of applications (CDB, LCA, LCI, Treasury Direct, pre or post fixed), this analysis gets a little more complicated.
The spreadsheet available for free in this post will assist you in comparing the various types of applications and you can make the decision that will bring you the best return. Below you can perform the download and learn in detail how to use it. I suggest you read the post until the end to learn how to make the most of this worksheet.
Download Spreadsheet: best application in fixed income
Using the fixed income sheet
The first concern you should have when using the spreadsheet is only change numeric fields that are yellow. No change mainly cells having formulas.
The first part determines what will be their term objective and amount to be invested. Below the featured picture and, lower, the explanation of what each line.
Term investment (in months)
In this line you must enter how many months you want to keep the amount invested without cash it back to your account. It is based on this period that the spreadsheet will calculate the amount of income and also income tax to be deducted.
Important to note that this period will be the same for all types of investments in fixed income this spreadsheet, to keep this variable “Deadline” constant in all investment options.
Amount to be invested
In this line you must enter the amount in Reais (R$) I want to invest.
Interest from the nearest DI futures contract of maturity of the security that you are interested in buying (CDI)
This line should inform the value ofinterest of DI futures contract. To simplify, just understand that here comes the value of the Interbank Deposit Certificate (CDI) the market is pricing for a specific date in the future.
This fee can be obtained from online quote page of DI future of BM&FBovespa, which follows an international standard nomenclature for the determination of the period.
By accessing the quote page you'll notice the column “Vector.” the maturity dates of the Contracts are informed with a letter followed by two numbers. The numbers represent the year of maturity of DI contract and the letter corresponds to the month, according to the table below:
With this, if you want to know what the expected rate of DI contract in October 2021, you should look for code “V20” in column “Vector.” and verify the value reported in column “Last price” or, if no value, check column “Últ.Of.Compra”.
In this example, a DI contracts maturing in October / 2021 (V21), the rate being negotiated is 13,60% (data 10/08/2015).
There will be cases where the quote page will not report a date you need. When this happens, choose one closest to the term you want to keep your investment.
Why inform a future rate instead of a present rate?
The future rate reflects an expectation of how the market will be the economy that date. How is this calculated I have no idea, but I understand that this value is the most reliable that we can use in our simulation.
Use the forward rate leads to a future scenario of the economy and can answer us whether it is more advantageous to invest in assets indexed to inflation or the prime rate.
This line is informational only and shows the value of future monthly DI rate, since the previously reported value is an annualized rate.
CDB / Selic treasure / Post-fixed Bill of Exchange
This table covers the floating-rate securities indexed to the DI already informed. The trick now is to look at all your banks and brokers the best title that floating-rate category you can invest, with the amount of money required, and within previously reported.
this is important, because there is no use here inform one that pays CBD 130% do CDI, with minimum investment is $ 1 million, if you plan to invest up to R $ 30,000. Search for the best title from the available options in its possibilities.
Remember to only change the numerical cell in yellow.
OBS: To simulate the Selic Treasury, simply inform 100% in “Profitability Gross Monthly”. With that simplifies the comparison, as the Selic Treasury pays very close to the CDI.
The other lines are self-explanatory and automatically calculated by the spreadsheet.
CDB / Treasury Fixed / Bill of Exchange Fixed
This part of the table includes the fixed-rate securities. These securities are those with a predetermined rate at the time of purchase and do not vary over time.
I'm not a fan of these types of securities, They are unprotected because of the variation in inflation and interest rate of the economy, but in some cases can protect your assets. Anyway, not the disregard of Your Review.
Remember to only change the numerical cell in yellow. The others are automatically calculated.
CDB / Treasury IPCA / Letter Exchange Linked to Inflation
In this table they are treated the bonds that pay a fixed rate plus the inflation variation. With this title you will always have a real gain above inflation guaranteed by that pre-agreed rate.
Tell how many percent fee will be paid by the best title that found in this category. The title Treasury IPCA is this category and its rate can be seen in the Treasury Direct own page.
IPCA forecast for the next 12 months
Ideally provide that cell the inflation forecast (IPCA) the next 12 months. To do this simply access the page FOCUS Central Bank report, click on it with the most current date and refer to the first table IPCA forecast column “Today”. In the example below the value of the IPCA is 5,59% (Report Data 07/08/2015).*Click the image to see it larger.
The rest of the lines are informative and automatically calculated.
LCI / LCA
In this table you must provide the best quote for LCI (Mortgage Letter) ou LCA (Agribusiness Credit Bills) to find in their banks and brokers.
A special feature of this type of investment is that has no income tax collection and, generally, It is one of the best investments in fixed income market, but that the sheet can answer you in the end.
Currently the famous Savings Accounts are not beating or inflation, let alone win a dispute with other investment options in fixed income defined above, but I left it in the spreadsheet exactly for you to compare the difference in income.
Average monthly return
You can get the average profitability of the savings on the page remuneration of Central Bank savings deposits, column “Total remuneration” worksheet. Just grab the latest information table or, if you want to be more detailed, calculate an average of the last 30 or 60 days.
Summary table: Better enforcement in fixed income
After completing all the above information, the spreadsheet you indicate what the best fixed income security among the options that you have available in your banks and brokers.
Among the options provided in the examples, the best was the LCI / LCA, with net profitability 13,22% year.
Simulating: CDB pagando 117% do CDI
As was informed, LCI and LCA are not taxed on the income tax on income, as occurs in other investment options and, hence, We create the false impression that they are always the best investment options available in the market. Non semper…
The simulation is now keeping the same term 24 months, with the same amount of R $ 100,000, the same 14,30% de taxa DI, but now with the possibility of investing in a post-fixed CDB who is paying 117% do CDI.
As I write this post I see that there is a CDB Banco Pine, by brokerage XP Investimentos, which is providing exactly this rate 117%, with degree of risk A3 defined by Moody's. In other words, an excellent opportunity.
Then placing this information in the spreadsheet, and keeping other information, let's see how is the new result:
This last simulation shows that even a security that pays income tax may be more beneficial than one that has tax exemption. I hope this example has alerted you to always search among the various options available. One more reason to use the worksheet! ;)
Investing is definitely an art and need studies to understand what the best option available in the market. Is fixed income comparison sheet It will help you to compare the various options for titles available at your bank or broker, but the decision of where to invest is yours.
Another tip I would like to share is: always suspicious of the manager tips from your bank. It usually will offer you the best option for the bank. Remember, it is bank employee and have to meet goals. ;)
I hope this post and the spreadsheet will help you to choose the best investments in fixed income and, at least not, has encouraged him to study more about this topic.
OBS: In the calculations are not considered the fees charged by brokers and banks, because vary widely, but I do not think that will impact much on the result. Nevertheless, I advise you to also study hard about these rates.
I hope you enjoyed the post and I ask you to share with your friends! Encourage them to invest better and reduce their risk you borrow money! :)