Fixed Income – What is it? How it works?

Those who intend to invest, but are afraid to invest the money in more daring and risky options can choose Fixed Income as an option. This is a smart strategy that can bring excellent profitability.

This has become one of the most sought after modalities by Brazilian investors. There are several reasons, starting, of course, with income security and predictability.

But, before investing your hard-earned money, it is important to know more about Fixed Income and understand exactly what the possibilities are with this investment.

What is Fixed Income

Fixed Income - What is it? How it works?

To begin with, it is essential to understand what is Fixed Income. This is an investment whose return is predictable. You can choose to set a monthly percentage or vary according to rates such as Selic, CDI, inflation and others.

One of the most popular fixed rents is savings. However, as we well know, it is also one of the least interesting, since its performance is very low.

You can invest in Fixed Income based on private and public financial institutions. Even the government itself may be a possibility.

What are the types of Fixed Income

There are numerous types of Fixed Income. Understanding a little about them is important, as well as knowing this variety to be able to choose the one that best suits your demands and needs.

Although saving is an option, it is also considered the worst of all investment possibilities in this modality. So, let’s stick to other options that are more interesting. Are they:

  • Treasury Direct: buying government bonds is a safe choice that can pay off. The most interesting thing is to invest in Treasury + IPCA, whose income is greater than inflation;
  • CDB: the Bank Certificate of Deposit option allows you to lend money to banks. This is an investment protected by the Credit Guarantee Fund (FGC). Therefore, even if the institution goes bankrupt your money will be returned.
  • LCI and LCA; Letters of Real Estate Credit (LCIs) or Agribusiness (LCAs) are excellent choices and are exempt from income tax. Therefore, the redemption of the investment will be integral, without discounts.
  • DI Funds: DI funds can be redeemed at any time and have very predictable liquidity, usually following the SELIC rate.
  • Fixed Income ETF: ETF quotas are traded directly on the Stock Exchange and the income tax rate applied is 15% regardless of the time of application.
  • Debentures: Debentures are a little more risky, but also interesting. In this case, you buy debts from a company and receive the return value adjusted with interest.

In addition to these options, there are others. They are very varied and serve the most diverse audiences, always with more security and predictability than investments in the stock exchange, for example.

How to invest in Fixed Income

To start investing in Fixed Income the first thing you need to do is look for a broker. Create your account – which can be done online safely and quickly – and start the investment process.

The money that is in your bank account and will be used for investment must be transferred to that account at the brokerage.

There you will make the application. On the due date, the amount already adjusted with the earnings will be redeemed and can be transferred to your account again, or used for new applications.

What is the profitability of Fixed Income?

The profitability of this modality follows the Selic, that is, the interest rate applied in the country. But, with a good management of its bonds it is possible to obtain excellent yields, even surpassing the average.

However, the most important thing here is to know that there are pre-fixed, post-fixed and hybrid titles. Let’s understand each one of them:

Fixed-rate titles:

These securities do not change because they do not depend on variable indicators. In this case, it is possible to predict the exact amount that will be redeemed at the end. Just apply the percentage of interest fixed on the amount invested and the time of application.

Post-fixed securities:

In the case of post-fixed earnings, the gains depend on the variation of a financial indicator. This is the case of the Selic Rate, for example. When you buy a bond from this treasure you will only know the result at the end, according to the behavior of the rate over the life of the application.

Hybrid titles:

The Fixed Income hybrids, on the other hand, combine the two previous possibilities. This is the case of the IPCA Treasury that we mentioned at the beginning.

Despite suffering variation according to inflation, it also operates at a fixed rate (the value always comes after the “+”, as, for example: Treasury IPCA + 4%.

Thus, you know that you will earn at least 4% on the amount invested plus the variation of the main price index in the country during the fixed income investment period.


Without a doubt, Fixed Income is a very interesting option for beginning investors or for those who maintain a more conservative profile and prefer to invest their money in more certain destinations.

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