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Bonds
Bonds are common in India, it is a loan/debt issued by the public to the government or corporations. In exchange, the bond issuer or borrower (means government & companies) agrees to pay a fixed rate of interest and return the borrowed capital in a given time. Bonds are perceived as a haven. And one of the best benefits of bonds is that the bondholder gets the right on the company’s assets if the company gets insolvent. Moreover, bondholders are given preference over equity shareholders.
Benefits Of Bonds
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Bonds are liquid and can easily be sold in the secondary markets
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Fixed and higher returns than fixed deposits
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Safety of principal amount
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Tax benefits on a specific type of bonds
Facts
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Bonds are an affordable option of finance than bank loans.
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By issuing bonds, companies can get finance at 8 – 9%
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Bonds are a new concept for investors
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Senior citizens or retires may grasp 50 percent of their portfolio in bonds
