Our Services

Need Help?

Please feel free to contact us. We will get back to you within 1-2 business days. Or just call us now.

  • +91 5267841510
  • Reliable324@gmail.com

Bonds

What Is a Corporate Bond?

A corporate bond is a type of debt security that is issued by a firm and sold to investors. The company gets the capital it needs and in return the investor is paid a pre-established number of interest payments at either a fixed or variable interest rate. When the bond expires, or “reaches maturity,” the payments cease and the original investment is returned. The backing for the bond is generally the ability of the company to repay, which depends on its prospects for future revenues and profitability. In some cases, the company’s physical assets may be used as collateral.

Key Takeaways:

A corporate bond is debt issued by a company in order for it to raise capital. An investor who buys a corporate bond is effectively lending money to the company in return for a series of interest payments, but these bonds may also actively trade on the secondary market. Corporate bonds are typically seen as somewhat riskier than government bonds, so they usually have higher interest rates to compensate for this additional risk. The highest quality (and safest, lower yielding) bonds are commonly referred to as “AAA” bonds

  • Bonds are units of corporate debt issued by companies and securitized as tradeable assets.
  • A bond is referred to as a fixed-income instrument since bonds traditionally paid a fixed interest rate (coupon) to debtholders.

What are the different types of Bonds?

  • Government bonds: Government bonds are issued by the Central Government. They are also known as Government Securities or ‘’GSecs’.’ These Bonds carry the highest level of safety guaranteed by the Central Government and hence do not carry any credit rating.
  • State Bonds: The various States issues state Bonds in India. The States raise money via this Bond route regularly. These Bonds are called ‘State Development Loans’ or SDLs. Like GSecs, they are also perceived to be of the highest safety level and hence do not carry any credit rating.
  • Municipal Bonds: Municipal Bonds are issued by local or state-level government agencies to fund development activities like city development, urban transportation, healthcare infrastructure, etc. These Bonds are popularly called as ‘Muni Bonds.’
  • Public Sector Bonds: Public Sector Bonds are issued by organizations where the government holds more than 50% ownership. Example: NHAI, REC, ONGC, etc.
  • Corporate Bonds:The large corporations and financial institutions issue these bonds to capitalize on their business operations. They are rated by various credit rating agencies based on the risk profile of the bonds.
  • Taxable Bonds: All Corporate Bonds fall into this category. The interest income earned from investments in these Bonds is taxed as per the investor’s income tax slab.
  • Tax-Free Bonds:The PSU units issue Tax-Free Bonds. The interest income earned from investment in these Bonds is 100% tax exempted.
Business Growth Strategie

Develop strategic plans to enter new markets and expand your customer base.

Financial Planning and Analysis

Create detailed budgets and forecasts to manage your finances effectively.

Our Services

Financial Calculators

Need Help?

Please feel free to contact us. We will get back to you within 1-2 business days. Or just call us now.

  • +91 9818405753
  • fundz369@gmail.com