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29/09/18
20:43
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Originally posted by Catalogue:
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In the past when this all started they said they were Corporate Bonds as such they fall within the Government bonds and Junk Bonds with government bonds having typically high security and low risk (rated AAA as an example) and junk bonds with low security and high risk so with these Corporate Bonds secured to assets are seen to be high security medium risk hence 8% coupon (don't also forget that there is milk income provides interest cover as bond holders in this category want to have 1,5 times interest cover) compared to junk bonds of 13% and higher which are for those companies such as miners who are some time away from mining production hence no interest cover and need to capitalise the interest payment.
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For full disclosure I had been a accredited finance provider but moved on from that industry many years ago. And I have NO involvement with the bonds PDF are looking to secure I'm just an investor.