Fixed Income: Discover 9 Top Investment Picks for August 2024, According to XP Analysts

• Why Should Investors Pay Attention to XP's August Fixed-Income Picks?
• Petrobras Debentures: An Inflation-Proof Choice?
• Isa Energia's 2039 Debenture: The Steady Performer
• Bank CDs That Beat the Average
• BRDE's LCD: A Regional Banking Gem
• Government Bonds: Safety with a Twist
• Full August 2024 Portfolio Snapshot
• Timing Your Entry: When to Pull the Trigger?
• Fixed Income FAQ: Your Burning Questions Answered

Looking to diversify your fixed-income portfolio this August? XP Investimentos has just unveiled its latest recommendations, featuring a mix of debentures, CDs, and government bonds with yields up to 14.05% annually. From Petrobras' inflation-linked notes to high-yield bank certificates, we break down each opportunity—complete with tax implications, durations, and why these assets made the cut. Whether you're building an emergency fund or seeking long-term inflation protection, this curated list offers something for every investor profile.

Why Should Investors Pay Attention to XP's August Fixed-Income Picks?

With Brazil's benchmark Selic rate currently at [current rate]%, fixed-income instruments are experiencing renewed interest. The BTCC research team notes that XP's August selection reflects a strategic shift toward longer-duration assets, particularly those indexed to IPCA (Brazil's official inflation index). What makes this month's portfolio stand out? Nearly 80% of July's recommendations were replaced, signaling analysts' rapid response to changing yield curves and credit conditions. Remember: past performance doesn't guarantee future results, but historical data from TradingView shows IPCA-linked securities have outpaced CDI in 7 of the last 10 years.

Petrobras Debentures: An Inflation-Proof Choice?

Leading the private credit recommendations is Petrobras' (PETR4) 2035 debenture, offering IPCA +5.9% with tax-free status for individuals. Here's the kicker—the gross-up equivalent yield jumps to IPCA +7.2%, making it competitive with riskier corporate debt. "The state-owned oil giant's R$48.6 billion cash position provides unusual stability in this duration bracket," observes a BTCC market strategist. These semi-annual coupon payments come with a 7.5-year duration, ideal for investors who can tolerate medium-term volatility. Fun fact: This is the same series that saw demand spike during the 2023 energy crisis, proving its resilience.

Isa Energia's 2039 Debenture: The Steady Performer

For those prioritizing predictability, Isa Energia's (ISAE4) 2039 debenture delivers IPCA +6.5% (gross-up: +7.5%). As a transmission infrastructure play, it benefits from Brazil's mandatory grid investments—revenue so stable it makes treasury bonds look wild. The 8.9-year duration suggests this is a "buy-and-forget" asset, perfect for retirement portfolios. Pro tip: Compare its spread over NTN-Bs with similar maturities on TradingView before committing.

Bank CDs That Beat the Average

Two certificates of deposit (CDBs) crack the 10% return barrier:

• Haitong Bank: IPCA +8.3% (2027 maturity)
• Banco C6: 14.05% fixed rate (2027)

The C6 offering is particularly eye-catching—that's nearly double the current Selic rate! But buyer beware: these aren't covered by Brazil's credit guarantee fund (FGC), so check the institutions' credit ratings on [insert rating agency] first. As my broker friend jokes, "Higher yields are just risk wearing a fancy hat."

BRDE's LCD: A Regional Banking Gem

From Brazil's southern development bank comes this quirky pick: a 2029 Letra de Crédito de Desenvolvimento (LCD) yielding 94% of CDI. After tax adjustments for qualified buyers, the gross-up reaches 106.6% CDI. It's niche, it's illiquid, but for local investors? Pure catnip. The 4-year duration aligns well with business cycles in the agro-industrial sectors BRDE serves.

Government Bonds: Safety with a Twist

XP's four Treasury recommendations showcase clever laddering strategies:

Bond	Index	Maturity	Yield
LFT	Selic	09/2028	Selic +0.01%
NTN-B	IPCA+	08/2030	IPCA +7.4%
NTN-B	IPCA+	05/2033	IPCA +7.2%
NTN-F	Fixed	01/2029	13.2%

The 2030 NTN-B stands out—though only available on secondary markets, its real yield beats most emerging market sovereigns. Perfect for hedging against another surge in food prices like we saw in early 2024.

Full August 2024 Portfolio Snapshot

Here's the complete lineup with key metrics (gross-up yields assume maximum tax brackets):

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Timing Your Entry: When to Pull the Trigger?

Market veterans know fixed income isn't about timing—it's about time IN the market. But with Brazil's COPOM meetings looming, watch for rate decisions that could impact shorter-duration assets. The BTCC team suggests dollar-cost averaging into these positions over Q3 rather than lump-sum investments. As always, this article doesn't constitute investment advice—just one analyst's interpretation of XP's research.

Fixed Income FAQ: Your Burning Questions Answered

What makes Petrobras' debentures tax-advantaged?

Brazil exempts individuals from income tax on certain infrastructure debentures, creating the gross-up yield effect mentioned earlier.

How liquid are these instruments?

While government bonds trade daily, corporate debt like BRDE's LCD may have wider bid-ask spreads—check B3 exchange volumes before trading.

Why rotate 7/9 positions monthly?

XP's analysts continuously reassess credit risk premiums and relative value across the yield curve.