Types of Investments

The financial market basically offers two types of investment, fixed income and variable income. Both are quite interesting and should not be discarded by the investor.

In Brazil, the fixed income has much greater adhesion than the variable. And the champion of applications is still the savings.

Fixed Income

Fixed income is the type of investment that provides a projection basis or the calculation of the exact return before application.

Titles can thus be preset yield, with a specific annual interest, post-fixed, coupled to an indicator such as CDI (Certificate of Interbank deposit, return reference), or hybrid, with a fixed interest plus the change in IPCA (Index Consumer Prices, considered the official inflation of the country).

Are examples of fixed income much of the applications you know, like saving the CDB (Certificate of Deposit), LCI / LCA (Real Estate Letter of Credit and Agribusiness Credit Bills), Treasury Direct, debentures, LC (Bill of exchange), among others.

Variable income

The variable income is still little explored by the individual investor in Brazil. In more developed markets, such as the United States, it represents a much larger share of investments.

Examples of variable income are stocks, options and derivatives on stock exchanges, equity funds and multimarket, among others.

In the comparison with fixed income, the variable entails greater volatility and greater risk of loss, although it offers the potential for higher returns.

For those who are starting, it is important not to allocate all of their variable income reserves. Try to know your investor profile, to know if this type of investment makes sense to you and to seek information first, and if it is the case, initially allocate a small portion, such as 5% or 10%, for stocks or funds.

Market agents

Check below which are the main agents of the financial market in Brazil:

Issuers of securities

In fixed income, bond issuers may be the Treasury (for government securities) or financial institutions (for private securities).

Analyzing the risk, in this case, it is easy to understand why the Direct Treasury is considered the safest investment: you are putting your money in Federal Government debt, which undertakes to pay your money back plus interest.

In the case of private securities, the risk is higher, since they are private institutions (banks or brokerages).

To increase the security of these applications, there is an investor protection mechanism called the Credit Guarantor Fund, which guarantees the balance of some applications (such as CDB, LCI / LCA, savings) in the event of a breach by the issuer, up to a limit of up to R $ 250 thousand. To have this guarantee, make sure the product you are interested in has this protection before investing.

Stock Exchange

The stock exchange is a trading platform for publicly traded companies.

In Brazil, BMF & Bovespa (São Paulo Stock Exchange, Futures and Commodities Exchange) has been the official stock exchange since 2008, when the São Paulo Stock Exchange merged with the Commodities and Futures Exchange.

The investor may act in the spot market, directly buying shares of companies that he considers promising, or choose to invest in investment funds, in which the allocation role falls on the manager, a professional with extensive experience in the field.


Resource takers are businesses or individuals who need capital (for cash flow, working capital, financing, etc.) and are willing to pay interest on money.

Investor Relations

Investors are individuals or corporations who wish to multiply their capital that is left over. They give up the availability of the resource at a time to reap the appreciation in a previously agreed upon application term.

Investment Funds

Investment funds are an excellent way to enter the financial market, since they offer the chance for you to diversify applications without having much knowledge on the subject.

In a fund, you make an initial contribution, which is converted into quotas, and then expect that money to appreciate.

There are four types of funds considering asset classes, according to the Brazilian Association of Financial and Capital Market Entities: fixed income, stocks, multi- currency and foreign exchange.

Fixed income fund

It focuses on returns through investments in fixed income assets (also synthetic derivatives are accepted via derivatives), with strategies that involve interest rate risk and price index. They are indicated for those who want lower volatility and very controlled risks, with high liquidity.

Stock fund

It mainly has variable income assets, such as cash, bonds or subscription receipts, certificates of deposit of shares. At least 67% of the portfolio is allocated in these applications.

Multimarket fund

It is the most versatile of the funds and offers complex strategies without many restrictions on the allocations in certain assets or derivatives.

Foreign exchange funds

At least 80% of the portfolio is destined to directly related or synthesized assets, via derivatives, to foreign currencies. It is a very attractive option for those who have contracts in foreign currency and seeks to protect themselves from oscillations of the dollar or the euro, for example.

Posted on June 11, 2018 at 01:57 PM