List of Bonds Articles

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Bonds

What are the Advantages and Disadvantages of High-Yield Bonds?

When experienced investors choose the stock market instruments, they invest in multiple asset classes beyond equities. Although certain assets can yield higher returns, they swear by diversifying their investments within the stock market such that they are profitable in case one asset class goes through a bear cycle.

What are High-Yield Bonds?

The investment landscape has grown immensely over the years with plenty of financial avenues rising in the market. Thereby, creating opportunities for the individuals to augment their income levels.

What are fallen angel bonds?

A Fallen Angel Bond is an investment-grade corporate bond that was originally issued with an investment-grade rating but has since been downgraded to a high-yield (non-investment grade) rating due to adverse circumstances at the issuer.

What is AAA Bond?

The recent market correction has shifted the choice of investment from equity to debt instruments. Irrespective of the type, investment decisions are a trade-off between the potential rewards and risk involved and each investment is subject to some risk.

What is the difference between coupon and yield?

The coupon rate is the annualized interest amount. It is the percentage of the face value that a bond pays in one year.

What is the minimum and maximum limit for investment in bonds?

As an investor, you will be paid interest during the life of the bond and receive the principal amount back at the end of the bond’s life (or maturity) or at the end of a dedicated period in which the interest amount is credited to your account.

How are shares allotted in an IPO?

As businesses grow, so do their capital needs. Filing for an IPO is one way in which companies attempt to infuse massive funds into their company. An IPO or Initial Public Offering is the process by which a privately held company or a government entity raises money from the open market.

How much are the charges for SLBS?

The SLB Mechanism is a system where a trader can borrow shares that they don’t own. The associated SLB transaction has a rate of interest and a fixed tenure.

How to calculate the coupon rate of a bond?

The coupon rate (also called nominal yield) is the annual coupon payments paid by the bond issuer relative to the bond's face or par value.

What are the disadvantages of a bond?

The recent rate hike by the Reserve Bank of India has led to the increased popularity of the bond market. Zero-coupon, convertible, and inflation-linked bonds are among the various bonds traded in the bond market.