Corporate Bonds
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There is no safe yet high yield things. High yield likely to come with high risk.
The challenge is understand one’s risk appetite and then find instruments that can match your appetite
As said, always invest with the money u can afford to lose and if anything happens, you can still remain ok
I do apply ipo of some shares & bonds, noting there is risk not to see the money invested -
Besides https://www.bondsupermart.com/main/home
any other website for reference?
How do we find out the liquidity of the bond or how do we find out the top volume of the traded bonds?
Any advice on which bank/finance vendor to use for low tranactions fees? -
I dont buy to sell bonds. I keep them till maturity for their coupons. I try to diversify the types of bonds i buy
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zbear:
They are not high risk. Short term or not depends on the bond itself. You are also free to sell it anytime u wish at market price.I like to know more about Corporate Bonds n hope that those who are knowledgeable can share.
Are they high risk? I was told that they are safe n gives high yields. They are good for short term n has liquidity. Is it true? The only risk if the company goes bust but if you buy blue chip company, it shld be safe?
Thanks.
In the current market, value of corporate bonds are rising due to market uncertainty.
So far in history, I dun think any blue chip company did not manage to redeem its corporate bonds. Buy those companies that u r familiar with and please study their financial statements also.
In the event of company collapse, corporate bond holders are among the first in line to be paid. To me, almost zero risk. Just choose the right company to buy.
The amount each corporate bond requires is huge so think twice before throwing in retirement funds especially if that is the only sum u have. Most ppl either keep their corporate bonds till maturity or at least a few years.
Go for leverage if u can. In that way, the same amount of money can get u 2 corporate bonds. -
TheAnswer:
They are not high risk. Short term or not depends on the bond itself. You are also free to sell it anytime u wish at market price.zbear:
I like to know more about Corporate Bonds n hope that those who are knowledgeable can share.
Are they high risk? I was told that they are safe n gives high yields. They are good for short term n has liquidity. Is it true? The only risk if the company goes bust but if you buy blue chip company, it shld be safe?
Thanks.
In the current market, value of corporate bonds are rising due to market uncertainty.
So far in history, I dun think any blue chip company did not manage to redeem its corporate bonds. Buy those companies that u r familiar with and please study their financial statements also.
In the event of company collapse, corporate bond holders are among the first in line to be paid. To me, almost zero risk. Just choose the right company to buy.
The amount each corporate bond requires is huge so think twice before throwing in retirement funds especially if that is the only sum u have. Most ppl either keep their corporate bonds till maturity or at least a few years.
Go for leverage if u can. In that way, the same amount of money can get u 2 corporate bonds.
:thankyou:
Thanks TA for sharing. It's very informative. My RM kept recommending me to go for corporate bonds becos they give higher yields.
What does leverage means? Pls explain - I am totally suaku. :oops: -
eh, I won't say that it's corporate bonds are low risk. No one ever anticipated that Lehman Brothers will go under - but it did. There is an order of payment in event of company going under. Also, the amount you get back and WHEN you get back may be affected by the circumstance. If one has holding power and doesn't need the money, fine and good. If one needs money desperately, then be aware.
This is a general guide: (http://www.investopedia.com/ask/answers/09/corporate-liquidation-unpaid-taxes-wages.asp)
Pls know the type of bonds you are buying - secured/unsecured, tenure, company financial strength/outlook etc. Interest rates are directly related to risk. -
zbear:
I don't know a lot as my husband deals with our investments. But I have heard that you can't count on being able to sell them as and when you like at a good price. The market may not be liquid at the time you wish to sell, or the price may not be what you want. However, if you select reputable companies and are happy with the returns, just be prepared to hold them until maturity.I like to know more about Corporate Bonds n hope that those who are knowledgeable can share.
Are they high risk? I was told that they are safe n gives high yields. They are good for short term n has liquidity. Is it true? The only risk if the company goes bust but if you buy blue chip company, it shld be safe?
Thanks.
As other have said, higher interest rates will indicate higher risk, so be careful when you select bonds. Also, no matter how \"safe\", the future is not always predictable, so don't invest amounts that you can't afford to write off, especially if the risk is higher. -
Leverage means taking a loan from the bank. Loan will be available to people who either have 2 million individual net worth or $300K annual income.
Let’s say your corporate bond is 6% interest. Bank take 2% u take 4%… but u need to come up with 50% to 60% of capital.
I m not sure if everyone is on the same page cos corporate bond is different from a normal bond. Market conditions do not fluctuate corporate bonds much. In fact it is a safer option. From what I can see from my portfolio. It has been rising since Brexit…
Like I say, if it is your retirement fund, make sure u do lots of homework yourself… -
Fyi, if it is a corporate bond, bank only let u leverage not just because they value you as a customer but also faith in that bond itself…
Do more homework. Dun depend on our opinions, our risk appetite is different. -
Is the only way to buy bond that are OTC on fundsupermart?
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zbear:
I like to know more about Corporate Bonds n hope that those who are knowledgeable can share.
Are they high risk? I was told that they are safe n gives high yields. They are good for short term n has liquidity. Is it true? The only risk if the company goes bust but if you buy blue chip company, it shld be safe?
Thanks.
The only SAFE BONDS are sovereign bonds issued in the country's native currency. Corporate Bonds even if rated AAA are still risky. -
If u buy a corporate bond, please try to understand their business models n operations. Go through their financial statements. Know what u r buying into. Most ppl make money in fact lots of it though corporate bonds. It is a good source of passive income if u understand their business. Buying blindly is dangerous. Do ur own research.
If u have the money, invest them. Money depreciates as time goes by. -
Riding on this thread, anybody into Singapore Government Bonds though their yields are pale in comparison with some retail bonds?
Thanks. -
Hi, for corporate bonds, apart from the risk of company going burst, what other risks are there that will cause a loss of investment?
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mummyxoxo:
Hi, for corporate bonds, apart from the risk of company going burst, what other risks are there that will cause a loss of investment?
There is a buying and selling price of the bonds
If you sell below your buying price, you suffer a loss
Correct? -
starlight1968sg:
Yes, but you can hold it to maturity and get back 100% capital (unless there is bad news on the company and you will rather cut loss and sell in the open market at a lower price).mummyxoxo:
Hi, for corporate bonds, apart from the risk of company going burst, what other risks are there that will cause a loss of investment?
There is a buying and selling price of the bonds
If you sell below your buying price, you suffer a loss
Correct? -
it may not be all true that you’ll get back your capital on maturity date, even if company has no going concerns. Read the TnC. Some corporate bonds may have clause that says 'in the event of liquidity issues, company can choose to repay capital at some later date or convertible to equity etc…" also, if there are cashflow problems and the company can’t honour its obligations, then you are just as good as any other normal creditors…
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Imp75:
it may not be all true that you'll get back your capital on maturity date, even if company has no going concerns. Read the TnC. Some corporate bonds may have clause that says 'in the event of liquidity issues, company can choose to repay capital at some later date or convertible to equity etc....\" also, if there are cashflow problems and the company can't honour its obligations, then you are just as good as any other normal creditors.....
the doc is so thick and \"cheem\" lei, difficult to read :?
for conservative, go for housebrand like Fraser, Maple tree - in REITs . commercial retail / capitaland ; guccoland;fareast;ascott etc OR bank bonds
Such Corporate bonds may yield reasonable returns only in 2 to 3+/4 % . High returns mean HIGH RISK
There are simple retail bonds by capitaland, Fraser, Genting - starter can try this ( can trade in sgx) -
In short, buy with $$ you can afford to lose