CDB and CDI Discover the Differences and How to Invest

If you don't know what CDB and CDI are, discover the differences and how to invest, below you will find a complete guide on how to get started!

If you are looking for fixed income investment options, you have certainly heard about CBD (Bank Deposit Certificate) and the CDI (Interbank Deposit Certificate).

Therefore, in this article, we will explain what these instruments are, how they work and how you can use them to your advantage.

This way, you can make more informed decisions when investing your money.

What is CBD?

Definition of CBD

O CBD is a title issued by financial institutions with the aim of raising funds.

So, when you invest in a CDB, you are lending your money to the bank in exchange for a return.

Therefore, the bank uses these resources to offer loans and financing to other customers.

CBD Features

1. Income: The yield of the CDB can be pre-fixed, post-fixed or linked to an inflation index, such as the IPCA. Therefore, when choosing a CDB, you should be aware of what its profitability will be.
2. Liquidity: Liquidity varies depending on the security. Some CDBs allow redemption at any time, while others have fixed terms. Therefore, it is important to choose one that fits your liquidity needs.
3. Expiration Date: CDB terms can vary from 30 days to 5 years. Therefore, the longer the term, the higher the profitability.
4. FGC Guarantee: CDBs are guaranteed by Credit Guarantee Fund (FGC), which covers investments of up to R$250,000.00 per CPF and per financial institution. Thus, this is a safe option for those seeking to preserve capital.

What is CDI?

Definition of CDI

O CDI is a reference rate for loan transactions between financial institutions.

Therefore, it is used as a benchmark (reference index) for various financial applications, such as CDBs, LCIs and investment funds.

CDI Features

1. Reference Rate: The CDI is the average rate of loan transactions that occur between banks. Thus, it reflects the profitability of fixed income investments in the market.
2. Relationship with CBD: Many financial institutions offer CDBs with yields linked to the CDI. Therefore, this means that the CDB's yield will be a percentage of the CDI, such as 100% of the CDI or 120% of the CDI.
3. Volatility: The CDI can vary over time, as it is influenced by the Central Bank's decisions regarding interest rates. Therefore, it is important to monitor this rate to understand how it can affect your investments.

Differences between CDB and CDI

Nature of the Product

• CBD: It is a debt security issued by banks. Therefore, you lend money to the bank and receive a return in return.
• CDI: It is an interest rate that serves as a reference for various applications. Therefore, it is not an investment, but an important indicator for the financial market.

Profitability

• CBD: Profitability varies depending on the type of CDB chosen (pre-fixed, post-fixed or inflation-linked). Therefore, you can choose according to your risk profile.
• CDI: The CDI is used as a basis for calculating the profitability of many investments, including CDBs. Therefore, when you see that a CDB yields “100% of the CDI”, it means that the profitability will be equal to the CDI rate.

Guarantees

• CBD: CDBs are guaranteed by the FGC, offering security to the investor. Therefore, if the issuing bank goes bankrupt, you will still receive your investment, up to the limit of R$250,000.00.
• CDI: The CDI does not offer guarantees, as it is not an investment product. Therefore, you cannot invest directly in the CDI, but you should pay attention to the rate when choosing your investments.

How to Invest in CDB?

1. Open an Account at a Financial Institution

To start investing in CDBs, you need to open an account with a bank or brokerage that offers these securities.

Therefore, you can opt for traditional or digital institutions depending on your preference.

2. Choose the Right CBD

As soon as you open your account, research the CDB options available. Therefore, pay attention to profitability, term and liquidity.

This way, you can choose a CDB that suits your investor profile and your financial needs.

3. Make the Investment

After choosing the CDB, you can make the investment through the financial institution's platform.

Therefore, it is important to check all the details of the title before confirming the application.

4. Track Your Investment

After investing, it is essential to monitor the profitability and conditions of the CDB.

This way, you can reevaluate your options and make adjustments to your portfolio if necessary.

Conclusion

Investing in CDB and monitoring the CDI rate are important strategies for those who want to diversify their fixed income investments.

Therefore, while the CDB offers the possibility of profitability and security, the CDI acts as a fundamental indicator that helps in decision-making.

So, with the right knowledge about these tools, you can make more informed decisions and maximize your investments!

Banco do Brasil's Invest Talk will give more tips on the subject, visit the website and check it out!