Introduction of Bonds and Type of Bonds

Understanding Bonds and Type of Bonds

Bond is a certificate of indebtedness issued by the company to its holder in exchange for interest of a certain amount. In each bond is shown the nominal value of bonds and bond interest rate. The nominal value or the par value is the value indicating the amount to be paid by the company at the time the bond matures. While the interest rate on bonds shows a certain percentage of which must be paid periodically to the bondholders.

Companies issuing bonds are usually caused by large amounts of funds that can’t be met from the accumulated retained earnings or from bank debt. Because these bonds have a maturity period of more than one year (usually between 5 to 20 years), then if the company issues bond it will generate bond debt. Contact Las Vegas bail bonds for best bail bond services.

These debts are grouped into long-term debt. Bonds and Bonds Types

Types of Bonds

1) Secured bonds and bonds are not guaranteed

Among the secured bonds are: Mortgage bonds are bonds whose issuance is secured by a specific guarantee such as real estate. Included in this secured bond are trust bonds whose issuance is guaranteed by shares or bonds of other companies.

Unsecured bonds are bonds whose issuance is not guaranteed by a guarantee. These bonds are very risky so that if the company issues this type of bond will provide a high interest rate, in order to attract potential investors.

2) Futures Bonds, Serial Bonds and Bonds Can Be Redeemed

Bonds are bonds that have maturities in one date. Serial bonds are bonds that have a serial or gradual maturity date. Bonds can be redeemed is a bond that entitles the issuer to redeem and withdraw the bond before its maturity.

3) Convertible Bonds

A convertible bond is a bond that can be converted with other securities at a time after its issuance. Usually this type of bond will be converted into stock.

4) Registered and Top Bonds Performance

Registered bonds are bonds issued on behalf of the owner. Bonds on the show are bonds that are not listed the name of the owner and can be transferred from one owner to another owner only through submission only.

That is the understanding of bonds and types of bonds.