In times of change of government and several reforms on the agenda, the fall of the Selic becomes the central topic on the tables of financial institutions, risk agencies and also Brazilian families, as well as being an essential factor for the asset tokenization market.

and why this happens?

The reason is simple: the Selic rate is the basic interest rate and is a fundamental instrument for controlling inflation through its impact on other interest rates charged in the economy.

Among them, interest on consumer credit and interest on financing, such as housing and automotive, but Selic does not only affect consumption: the level of attractiveness of investments is directly affected by the basic interest rate.

There is a relationship between Selic and the profitability of off-the-shelf products in the traditional financial market, but what will be the best investments in a downturn?

BLOCKBR, a company that develops tokenization infrastructure, will talk about how to deal with your investments with the Selic falling!

UNDERSTANDING THE SELIC RATE

The Selic Rate, or Special Settlement and Custody System, is a fundamental tool for Brazil’s monetary policy and impacts the economy in different ways.

• Controlling inflation, increasing the rate to make credit more expensive and discouraging consumption and reducing it to create the opposite effects;
• Fixed income investments. With a high Selic, they become more attractive;
• Interest on financing and loans;
• Consumer and investor confidence, influencing spending and investments;
• Public debt, since Selic affects the government’s financing cost.

As we can see, the Selic’s spectrum of influence is broad. For this reason, everyone – businesspeople, consumers and investors – must pay attention to the Central Bank’s decisions and which direction they point in the medium and long term.

HOW THE FALL IN THE SELIC COULD AFFECT INVESTMENTS

The fall in the Selic rate directly affects the remuneration of fixed income products, such as the Selic Treasury, despite the direct Treasury having options that compensate for the loss of this product as they are not linked to the interest rate.

This creates an opportunity to invest in variable income securities or in direct capital from companies, financing projects, as occurs with shares and funds.

A savings account is definitely not an option in times of low Selic – in fact, this is an unattractive application even when Selic is high. Therefore, it is time to abandon it.

There are many options for investing with a low Selic. Research each one carefully and consider your investor profile, as there are other factors that weigh on investment decisions – deadlines, risks, liquidity and volatility.

5 TIPS ON WHERE TO INVEST WITH THE FALL IN THE SELIC

ETF (INDEX FUNDS)

Index funds (or exchange-traded funds) are investment funds in a market index and in essence are investment baskets linked to the performance of the index, such as Ibovespa.

They allow investors to gain diversified exposure to a broad set of financial assets, such as stocks, commodities or bonds, and capture yields from products that are not directly affected by the Selic.

MULTI-MARKET FUNDS

Operating similarly to ETFs, they are funds in which managers use the diversity of assets, a characteristic of the product, in times of a fall in the Selic to direct gains and maintain the attractiveness of the multimarket fund.

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PROPERTY FUNDS

FIIs operate similarly to multimarket funds, with the difference that investments are made in real and financial assets linked to the real estate market. With the Selic low, it is an alternative for diversification and income not linked to the basic interest rate.

Currently, tokenized real estate funds already exist, which combine the earning potential of FIIs and the agility, availability and security of investment tokens.

TREASURE TITLES

A Treasury bond is, in practice, a loan from the investor to the government with the promise of a future payment of the principal plus interest. Here the two interesting ways to obtain better returns with the Selic falling are:

• Pre-fixed Treasury: the profitability is already known at the time of application and this guarantees protection against interest rate fluctuations;
• Treasury IPCA: comprise a pre-fixed remuneration part and a part linked to the IPCA, the index that measures inflation.

ASSET TOKENIZATION

Trading tokens are, in fact, the digital representation of the offering of an ever-increasing range of real assets – super-structured tokens – and financial assets – structured tokens, represented by tokenized receivables.

It is also possible to invest in business projects such as the agribusiness token – in a remuneration model similar to shares – and in tokenized financial tokens that do not suffer the direct impact of the fall in the Selic.

It is the opportunity to obtain passive income above the market average, as tokenization reduces issuance and control costs, increases the availability of applications and democratizes investment.

INVEST AND EARN MORE WITH TOKENS ON BLOCKBR!

Buying token is not complicated if you invest with someone who makes it easy! Just open an account with a qualified asset tokenization company and create a digital wallet to store your applications.

Access our token marketplace, learn about the most varied offers and choose the ones that align with your investor profile. And you can start investing in digital assets for as little as 50 reais!

Open your account with BLOCKBR and earn more with your investments!

TOKENIZE YOUR ASSETS WITH BLOCKBR!

Tokenization is a reality that is becoming present in all segments and business models, it is not something so innovative that it should still be seen with suspicion. Companies and individuals are currently monetizing tokens.

Recent actions by BACEN and CVM signal that tokenization is legal and the digital real will be a great divisor to increase the credibility of technology for those who want to invest in digital assets.

Offering your business token is simpler than you might think. Do you want to see the competition come out ahead?

Come and talk to BLOCKBR.

We have the best token offering strategy on the market!

BLOCKBR Digital Assets is a fintech specialized in tokenization of assets and investments that delivers infrastructure to the regulated and non-regulated market through an All-In-One platform that offers the transformation and interoperability between assets and investors.

For more information, visit: http://www.blockbr.com.br or @blockbr_ on social networks