Corporate Bond
Corporate Bonds are financial instruments (or securities) through which companies raise debt from investors. The capital raised is used to achieve business objectives such as starting new projects, scaling existing businesses, or working capital needs.
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Investors who buy bonds are lending money to such companies that issue the bonds. In return, the companies enter a binding commitment to make interest payments periodically and repay the principal amount on the maturity date.
YTD% | Volatility | Return | Security Cover | Repayment | |
|---|---|---|---|---|---|
8-11% | No | Yes | Yes | Monthly | |
6-8% | No | Yes | Yes | End of Life |
Investment opportunities in Corporate Bonds
Downside Protection
Curate Corporate Bonds that are secured. The value of the security is usually higher than the principal of the loan; hence, in a draconian scenario, the investors have a higher probability of recovering their capital.
Investment Grade Rated
Identify Corporate Bonds that are rated by reputed credit rating agencies such as CRISIL,
ICRA, and India Ratings (Fitch), and are investment grade rated, implying a low risk of default.
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Liquidity and Tradability
Select Corporate Bonds that are in dematerialized form and listed on the stock exchanges to enable secondary trading, should the investor need to exit before maturity.