Alternate Investment Products

Portfolio Management Service

A Portfolio Management Service (PMS) is an investment vehicle that provide access to a wide range of investment strategies which are managed by qualified and experienced portfolio managers on behalf of the client. Bank of Baroda makes available a wide bouquet of PMS products manufactured by reputed third party Portfolio Managers to suitably address the investment needs of its customers.

Structured Products

Structured products are hybrid investment instruments which consist of a component of Equity/Debt & are enhanced using derivatives to provide better risk-return profile and pre-defined payoff. Returns for these products are linked to performance of an underlying benchmark such as Nifty, G-sec yield, single or basket of stocks. These are designed for niche investors who want to invest usually for a fixed period with calibrated exposure to the capital markets.

Private Equity & Real Estate Funds

Provide customers access to a unique investment opportunity in a vast and growing universe of across privately held companies. These are niche products and usually have low correlation with traditional asset classes.

Non-Convertible Debenture (NCD’s)

Non-convertible debentures are fixed-income instruments issued by companies in the form of public issue. Some debentures are convertible to Equity at the discretion of the owner, but these debentures cannot be converted to Equity hence the name ‘Non-convertible Debenture’. Like any other fixed income instrument, NCD’s have a fixed maturity date and investors receive interest on specified dates. NCD’s can either be secured by the issuing company’s asset or can be unsecured.

Tax free bonds

Tax-free bonds are issued by public sector companies to raise funds and are tax free in nature as the name suggests. Unlike other bonds, Interest from these bonds do not form a part of the total taxable income and are exempt from tax as per Section 10 of the Income Tax Act of India, 1961. As the interest is exempt from tax, the effective yield is attractive to the investors especially the ones in the highest tax slab.

Section 54 EC –Capital Gain Bond

Capital gain bonds or 54EC bonds are the fixed income instruments that provide capital gains tax exemption under section 54EC to the investors. The tax liability on long-term capital gains from sale of immovable property can be reduced by purchasing 54EC bonds.