Find out how much BRL 1,000 yields with the Selic at 13.75% – 05/03/2023 – Market

The maintenance of the Selic rate at 13.75% per year by the BC (Central Bank) this Wednesday (3) means that the main financial investments in fixed income continue to offer attractive double-digit returns —without discounting inflation— to investors .

Survey carried out at the request of Sheet by Andrew Storfer, director of economics at Anefac (National Association of Finance Executives), shows that an investment of BRL 1,000 in the Treasury Selic bond, a paper issued by the government that closely monitors the profitability of the basic interest rate, would yield an additional net of IR (Income Tax) of R$ 114.46 in a period of 12 months. The interest paid on the application is 13.87%.

“Treasury Direct, CDBs from large banks, conservative funds and real estate and agricultural letters of credit continue to be safe investments and with yields very close to or even above the Selic”, says the director of Anefac.

If the option is for a CDB (Certificate of Bank Deposit) from a large bank, the investment of R$ 1,000 would bring a return of R$ 105.50 within a year.

In the case of medium-sized banks, the income rises to R$ 124.78 in 12 months. Storfer argues that the higher yield of medium-sized banks stems from a higher level of risk assumed by the investor.

In this case, the expert’s recommendation is that the application be limited to an amount of up to R$ 250,000, an amount covered by the FGC (Credit Guarantee Fund) in case of bankruptcy of the financial institution.

The Anefac study also shows that an application of the same value in an LCI (Real Estate Letter of Credit) or LCA (Agricultural Letter of Credit), instruments with tax exemption for individuals, would bring a nominal income of R$ 126.50, upon interest of 12.65% per annum.

Prefixed and indexed to inflation become more attractive with the start of the Selic cut, says expert

Analyst at Toro Investimentos, Rodrigo Caetano says that, in a scenario in which the BC starts the cycle of cutting the Selic rate in the coming months, fixed-rate securities, which guarantee a nominal return at the time of purchase, and those indexed to the inflation, which pay a predetermined interest plus the IPCA variation, are highlighted on investors’ radar.

This is because, if the Selic falls, the investor guarantees, with the purchase of securities at this moment, a higher interest rate than what will probably be practiced in the market a little later, explains Caetano.

In the case of post-fixed papers, which accompany the yield paid by the Selic, the investment tends to lose part of its appeal as the BC starts to cut interest rates, but it should still remain at a relatively high level, adds the Toro analyst.

In the Focus bulletin, the median projections of economists consulted by the monetary authority indicate the basic interest rate at 12.50% at the end of this year and at 10% in December 2024.

Savings continues with the worst profitability of fixed income and accumulates redemptions of BRL 50 billion in the year

Regarding the traditional investment in savings, the Anefac study points out that an application of R$ 1,000 would bring an additional return of R$ 61.70 in 12 months, the lowest among the investments considered in the survey.

Despite the increase in the Selic rate, which rose from the historic low of 2% in March 2021 to the current 13.75%, the application of the passbook continues with the yield unchanged at 6.17% per year, plus the TR (Referential Rate ).

Savings remuneration is 0.5% per month whenever the Selic rate is above 8.5% per year. When the basic rate is up to 8.5%, the savings yield is equivalent to 70% of the Selic rate.

“In this scenario, despite being a very easy and safe application, savings are not competitive and yield less than half of the current Selic”, says Storfer.

Faced with low profitability, BC data show that savings suffered a net withdrawal of R$ 6.087 billion in March. In the first quarter, the application already accumulates redemptions in the order of R$ 51.233 billion.

Stock market still requires greater dose of caution, says Toro analyst

Regarding the prospects for the shares, Caetano, from Toro, says that a scenario of a drop in the Selic ahead tends to be a positive factor for the Stock Exchange in general, especially for companies in the retail sector, which tend to be the most impacted due to the reduction in purchasing power and customer demand.

The reduction in interest rates in isolation, however, should not be enough to allow an outstanding performance of the shares, adds the analyst.

The uncertainties that remain about the conduct of the government’s fiscal policy in the coming years and the high level of indebtedness of Brazilian families are points of attention that keep financial agents on the alert and that tend to prevent a more robust growth of the economy, with repercussions for the performance of the Stock Exchange, says Caetano.

In this scenario, shares of companies that are already well established in sectors that are more resilient than the market average, such as banks, electricity and sanitation, are presented as safer options for investors seeking some exposure to variable income, says the specialist.