Valuable Insights: 7 Good Arguments for Corporate Bonds
Seven good arguments for corporate bonds! Our free information brochure shows you in detail the advantages of corporate bonds:
As an established asset management firm with more than 20 years of experience and over 1,000 clients, Genève Invest is one of the most respected representatives in the financial industry.
These decades of experience enable us to provide you, as a private investor, with valuable insights into the field of profitable asset management – first-hand.
Building capital assets takes time, effort and knowledge. The same applies to management. We are happy to pass on our knowledge to you in this information brochure.
Corporate bonds with different maturities
When companies want to expand their operations or finance new ventures, they often turn to the corporate bond market to raise money from investors. A company determines how much it wants to borrow and then issues a bond offering (issue) for that amount. Investors who buy a bond effectively lend money to the company according to the terms set out in the bond offer, called bond covenants.
Over the years, the corporate bond market has attracted many investors seeking higher yields than government bonds offer. Overall, corporate bonds are the second largest sector in the bond market after government bonds.
Unlike equities, ownership of corporate bonds does not involve a stake in the company that issued the bond. Instead, the company borrows funds from the owner of the bond and pays interest over a specified period of time and repays the principal on the maturity date set at the time the bond was issued.
While some corporate bonds have redemption or call features that may affect maturity, most are categorised into the following maturity ranges:
- Short-term bonds with maturities of up to 5 years
- Medium-term bonds with maturities between 5 and 12 years
Long-term bonds with maturities of more than 12 years
READ MORE IN OUR FREE BROCHURE
The Genève Invest Group has been successfully active in the field of asset management for many years, offering you valuable insights into the capital market. Find out why we have continuously held corporate bonds in our portfolio for more than 20 years and why this will not change in the future.
Escaping the low-interest-rate environment
Carefully selected corporate bonds belong in every well-diversified portfolio. The corporate bond universe offers investors a comprehensive range of options to find the combination of risk and return that suits them best. Corporate bonds are, therefore, a core component of diversified, return-oriented investment portfolios.
In the current low-interest-rate environment, it is virtually impossible to meet the expectations of sophisticated investors with the traditional type of advice offered by banks and their mostly in-house products. Corporate bonds offer relevant reasons why they belong in every portfolio. Lower fluctuations in value compared to shares, as well as a certain degree of legal protection for bondholders, reduce the risk. Furthermore, regular interest distributions and redemptions provide excellent predictability to optimally plan for future liquidity needs.
Genève Invest specialises in fixed-income corporate bonds and uses numerous safety factors for sound analysis and diversified investment strategy […]