Understanding how bonds work can be a bit complex, but it's essential knowledge for any investor. One key concept to grasp is the coupon rate. Let's break down what it is and how to calculate it.Understanding coupon rateWhen you invest in a
Basics
Bond Maturity Explained: Duration, Perpetuals, & Interest Rate Impact
Bond maturity is a fundamental concept in fixed-income investing. It refers to the date when a bond issuer must repay the principal amount to the bondholder.Understanding this and grasping the concept of bond duration is crucial. It is also
Understanding Par Value: The Nominal Value of a Bond
One of the key figures you'll encounter when exploring bond investments is the par value. Think of it as the core promise an issuer makes to a bondholder. It represents the principal amount, also known as the face value, nominal value, redemption
Currency Denomination: A Key Factor in Your Bond Investment Strategy
When you invest in a bond, it's crucial to understand its currency denomination. This refers to the currency in which the bond's principal and interest payments are made.Why is currency denomination important?The currency denomination of
Complete Bond Features. What You Need To Know.
Bond features vary widely, directly impacting their associated risk and return profiles. For example, we differentiate bonds based on their issuer, which can come from corporations, governments, or supranational institutions. Government
Collateral: How it Works and Why It Matters
What's it? Collateral is a borrower's asset pledged when taking out a loan. When they default on the loan, they agree to turn it over to the lender. For lenders, collateral aims to secure loan repayments and reduce the impact of a default.
Bond Issuers: Who Are They? Why They Issue? Types
Bond issuers come from national governments, local governments, quasi-governmental institutions, supranational institutions, and companies. Each has a different default risk. For example, government default bonds are considered less risky than
Bonds: Types, Features, Risks, Pros, and Cons
What's it? Bonds are debt securities with a promise to pay back the principal at maturity and pay coupons regularly. They usually mature in more than 10 years. And we distinguish them with notes which are 10 years or less mature. Next, there are