G-Sec Bonds purchase can be financed by Margin?

Bonds
1

Hi all,

I am looking to buy bonds preferably at a discount. I am trying to see if my limit orders get executed on daily basis. However, this I guess it will take many days for my order to get executed!

Meanwhile, I was wondering if I can buy LIQUIDBEES and pledge them for margin instead of sitting on cash and use this margin to buy the bonds when Limit orders get executed? I will offload the LIQUIDBEES later once G-Sec limit orders are executed to furnish required cash for the bonds purchased.

Thanks,
Raj Pawan Gumdal

2

You can’t use collateral margin to buy G-Secs. However, you can sell your liquid ETF and use 80% of the proceeds on the same day to place limit orders for your G-secs.

1 Like
3

The above approach doesn’t appear to help with the scenario Gumdal described…

  1. be able to place an order for a GSEC bond first
  2. and ONLY IF the order gets executed, arrange for the sufficient funds to cover the order.

In other words,
what are the various ways (if any)
to generate sufficient margin for the above step1 ?

Judging from this, looks like there aren’t any ways.

1 Like
4

Thanks for the replies guys @Suyash.K & @cvs.

I have decided to invest in Gilt funds for the same reason now, can’t sit on cash forever to look for opportunities!

5

https://coin.zerodha.com/dashboard/gsec/invest

few bonds are available for purchase this week, all of them have indicative yield around 7%