Foreign government bonds are foreign national government debts sold to investors at a constant interest rate. Many investors choose government-backed bonds because they represent a low-risk investment. Today, emerging economies offer higher interest rates due to their faster-growing economies. Brazil currently has one of the fastest-growing economies in the world, but the country enjoys greater stability than many other developing nations. Brazilian government bonds are attractive to investors, but purchasing them is more complicated than buying other bonds.
- Skill level:
Come up with the funds for your initial investment. In most cases a minimum investment of £65,000 is required to purchase foreign government bonds. The minimum investment is usually dependent on the brokerage firm, but it often is in the six-figure range. Consider working with a partner to split the cost of the initial purchase.
Shop for a broker that can sell you a Brazilian government bond. In general, these bonds do not appear for purchase on broker websites. If you already have a brokerage account, call a representative to find out what's involved in buying Brazilian government bonds. If you do not have a current account, call large stock brokerages to determine if they offer the bonds.
Look for the best terms to purchase Brazilian government bonds. Many investors prefer working with established brokerages for uncommon investments such as foreign bonds. Also consider contacting smaller brokerages or internet sites that specialise in foreign government bonds. Find out how much initial investment you need, what commissions are charged, and if there are any other fees involved in investing there. Your broker should be able to handle the entire transaction for you.
Consider other ways to make low-risk investments in Brazil if you are not able to purchase Brazil's government bonds. There are several exchange traded funds that are set up to follow the Brazilian economy. These funds are traded on the New York Stock Exchange and are much easier to purchase than government bonds. Also consider bonds issued by Brazilian companies, which are easier to purchase than government bonds.
Tips and warnings
- Brazilian nationals are able to buy Brazilian government bonds directly from their government.
- Contact the Brazilian embassy to the UK to learn more.
- Foreign government bonds may carry risks. Consult a professional before making investment decisions.
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