Bond markets are markets for almost as long as equity. For most private investors, such as bonds are less attractive relative to government bonds, probably due to the relatively stable bond. You probably can also be argued that media markets, the stock market much broader than the coverage bond.
So what is a bond? Learned in school that a bond is a debt or an instrument issued by a companyGovernment. The buyer of the title is actually lending money to set up and promised the full capital plus a fixed periodic payment for the duration of the loan. The full payment received with the main A final calculation are set for the association to determine the yield. The yield, in legal terms, the effective interest rate earned on bond markets for the duration.
Some problems issuing zero-coupon Bonds that have not paid any bond during the term of office. The investor receives the difference between the purchase price for the license and the principal value, also known as face value.
While investment banking trading desks make profits on the bonds exchanged at regular intervals, through the acquisition of credit risk and duration of interest rate risk, this is often not the case for small investors who usually do not have the availability of interest live and> Bond trading data.
A small investor, the goal for the purchase of bonds may deposit rates are seen as an attempt to gain an ordinary performance better than a. The issuer is sufficiently creditworthy, investors should be able to get years of his capital in full at maturity of the bond, fifteen years, the term may have one of every three months. At the same time, investors may have the opportunity to invest on capital gains from its bindingif market interest rates should fall. This then provides a further advantage for loans on ordinary deposits.
trading of bonds. The bond market is still largely on the OTC market. Market participants include large investment banks, private banks and asset managers. Unlike stocks that are traded on an exchange and therefore have the transparency of prices, the bonds traded on the OTC market has no such price transparency;Citations are given and taken on a platform such as Bloomberg and Reuters. the lack of transparency in price from a lack of liquidity also prepared, because such a situation would be here decided to cash for a particular loan. It can be said that this is one of the reasons why investors are not very familiar with the bonds, since these stocks are.
Another possibility would be to buy bonds to buy directly from the issuer, the central bank or a company could be. Inmost cases, the minimum investment must be higher than most private investors willing to invest in one fell swoop.
Asian central banks, the deepening and development of bond markets, increased efforts in education and bond markets are seen with a key to attracting retail investors against.