See profitability in fixed income with Selic at 13.75% – 05/03/2023 – Market

With the maintenance of the Selic rate at 13.75% per annum this Wednesday (3) by the BC (Central Bank), incentivized infrastructure debentures emerge as the most profitable investment among the main financial investments of fixed income, according to with a survey by the investment search platform Yubb.

According to the study, incentive debentures, debt securities issued by companies to finance large infrastructure works that offer exemption from IR (Income Tax) to individuals, should deliver a real return of 8.97% in a 12-month window . To arrive at the result, the survey considered an inflation of 6.05% projected by Focus for 2023.

Following among the highest returns estimated by the platform, come the LCIs (Real Estate Letters of Credit) and LCAs (Agribusiness Letters of Credit), which also have tax exemption, with real yields of 7.30% and 6.91% , respectively.

“We are facing an excellent scenario for protecting assets through fixed-income securities”, says Bernardo Pascowitch, founder of Yubb.

He adds that, even if the BC starts to signal a possible reduction in interest rates ahead, the high Selic rate remains very interesting for investors to take advantage of opportunities in public and private fixed income.

At the opposite end, savings appears as the application with the lowest real yield among the main alternatives considered in the survey.

Even with the IR exemption, savings should deliver a return, discounted for inflation, of just 0.11% in a one-year window, shows the Yubb study.

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.

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.

The stock market can be a good entry point for the long term, says analyst

Despite the high profitability of fixed income, and the negative performance of the Stock Exchange —the Ibovespa drops by around 7% in 2023, until May 3— José Eduardo Daronco, an analyst at Suno Research, says that, for investors looking for a long-term horizon, the stock market at its current level may represent a good entry point.

“The best times to buy the Stock Exchange are at the top of the monetary tightening cycle, when interest rates are at higher levels”, says the expert at the analysis house.

For that investor who wants an attractive return and has the possibility of leaving the money invested for a longer time, the allocation in shares makes “complete sense”, adds Daronco.

The Suno Research analyst also says that, among the stock market sectors that tend to present an above-average performance, one of the highlights is agribusiness, with companies like Boa Safra and 3tentos. “Brazil is a powerhouse in agribusiness, with companies on the stock exchange that should grow despite the economy.”