What is Treasury Direct?
Through Tesouro Direto, individuals can invest in government bonds and the entire process can be done over the internet.
By this means, it is possible to invest in government bonds from values around R $ 30, in addition to having much lower rates compared to other types of investments.
When investing in Tesouro Direto, the money is lent to the government and later returned with the investment income. This remuneration is in Fixed Income and the investor knows the profitability conditions when investing.
The profitability of these bonds may be linked to inflation, through the IPCA, the basic interest rate Selic or a fixed rate.
As they are issued by the government, it is considered an investment with virtually no risk. This is because it is much easier for a private institution to go bankrupt than for the whole country.
Step by step to invest in Treasury Direct
- Choose a financial institution to broker the investment;
To start investing in Tesouro Direto, it is necessary to choose a custody agency, which can be a bank or a broker, to perform the intermediary in the operation.
The qualified financial institutions are listed on the Treasury Direct page, including the fees charged by each one.
If the process is done by a broker, just transfer the money from a bank account to start investing.
- Register with Tesouro Direto through the custody agency;
Through the chosen institution, usually through the website or investment application, a registration must be made with the Treasury Direct. An account will be linked so that investment transactions can take place.
Some brokers facilitate this step and the investment can be made directly through the platform offered by the institution.
- Receive the temporary password from BM & FBovespa and register a new password;
In the step following registration, a provisional password will be sent by the São Paulo Stock Exchange, currently known as B3. This password gives access to the places where the financial transaction should take place.
Change the password with a new one containing between 8 and 16 digits, consisting of letters, numbers and special characters.
- Analyze the best options to invest according to your profile;
Treasury Direct securities have daily liquidity. This means that the redemption of the invested amount can happen any day from the application. Despite this security, this means that the highest returns are on bonds where the money should be spent more time.
Because of this, you need to know the options available and compare with your investor profile and your goals, such as a short-term trip or long-term retirement. Understand below what these types are.
Types of investments in Treasury Direct
Treasury bonds are offered in two modalities, Prefixed and Post-fixed. In the first, we can know what the profitability will be at the time of application. In the second, profitability varies with an indexer while the money is invested.
When this title is acquired, all conditions and final profitability are known. Ahead is called the year in which the investment matures, as “Treasury Prefixed 2022”, for example.
There are also fixed-rate Treasury bills in which the yield is paid semi-annually, known as “Fixed-rate Treasury with Half-Year Interest”.
Post-fixed Direct Treasury
Part of the profitability of these bonds depends on an economy index. This can be the basic interest rate Selic or the IPCA, the official inflation indicator.
The “Tesouro Selic” is indexed by the Selic rate and the “Tesouro IPCA +”, a fixed part plus the variation of Brazilian inflation.
In floating-rate securities, there are also versions with interest paid semi-annually.
Costs to invest in Treasury Direct
Investing in Treasury Direct incurs costs for the investor, who must be careful not to compromise the bond’s profitability.
The first of the costs are fees, one charged on a semi-annual basis by Bovespa at 0.125% of the amount invested and the broker’s administrative fee, which in many cases may not exist.
On the other hand, there are taxes. The Tax on Financial Operations (IOF) is levied only when the application term is 30 days. Income Tax, on the other hand, is regressively applied to the yield on the security, for the following terms and rates:
|Investment term||IR rate|
|Up to 180 days||22.50%|
|181 to 360 days||20.00%|
|361 to 720 days||17.50%|
|Over 720 days||15.00%|
Applications at Tesouro Direto can be made every day between 9.30 am and 5 am the following day, including weekends and holidays.
When a security is purchased, the deadline for completing the purchase (settlement) is known as D + 2 or simply two days after the purchase, with the market closing at 5pm.
An example: if the purchase is made between 9:30 am on Monday and 5:00 am on Tuesday, it will be available to investors at 5:00 pm on Wednesday.
If the case is an advance sale of the security, that is, before its maturity, the money from the sale will be available in the investor’s account at 1 pm of the next day.
The yield on the securities, on the other hand, can be received on the same day of maturity or semi-annual interest, when applicable, through the account of the financial institution.
Advantages and disadvantages of Treasury Direct
Tesouro Direto has the advantages of the minimal risks they offer and easy access for investments between R $ 30. In addition, it has few costs in relation to the fees charged.
Despite this, other fixed income assets may be more interesting than government bonds and must be compared before investing. since even savings with such low rates can have a higher return in the end because there is no income tax.
To facilitate the decision process, it is possible to find a simulator on the Treasury Direct website itself, which even makes this comparison.
Another factor to consider is the daily liquidity of these securities, as it is possible to give up on the investment before winning. However, this depends on the price quoted in the market on the day the Treasury Direct repurchases it. In this case, the return may be higher or lower than the invested.
Ticks is an acronym for Taiwan, India, China and South Korea (South Korea). It was first mentioned in January 2016 by the Financial Times, replacing the BRIC concept.
The Bric group, formed by Brazil, Russia, India and China, is no longer the focus of international investors, due to the successive crises faced by some of the member countries. The recession in Brazil and Russia (B and R of the acronym BRIC) makes a crisis in the commodities market visible, giving way to an economy more focused on services, especially technology. In this context, Taiwan and South Korea (T and K for Tricks) walk alongside India and China in terms of information technology and gain prominence in this new economic order.
The Ticks appear as a new emerging group, from the point of view of international investment funds, replacing the BRIC. The group that included Brazil ended, as an international investment fund, decreed by Goldman Sachs, the same financial consultancy that launched the name. After successive declines in assets, Goldman closed its BRIC fund at the end of 2015.
The term ticks is also an internal expression of the financial market that represents the minimum variation that the stock undergoes in the price.