Articles on Fixed Income Securities

What are Fixed Income Securities?

Fixed income securities used to be a relatively obscure part of the financial markets. Up until the late 1970s, bond...

Types of Fixed Income Securities

When the term “fixed income securities” is mentioned, investors immediately conjure up images of bonds in their heads. However, this...

Types of Coupon Rates in Fixed Income Securities

Fixed income securities are important to investors’ portfolios since they provide regular income in the form of coupon payments. However,...

Cash Flow Types in Fixed Income Securities

The first thing that any investor related to fixed income markets first notices about the market is the sheer variety...

Bond Indentures and Covenants

When an investor thinks of bonds, they often think about the financial agreement between the investors and the borrowers. However,...

Types of Covenants

In the previous article, we had a closer look at the concept of covenants as well as indentures. However, we...

Common Restrictive Covenants in Fixed Income Securities

It is important for investors investing in fixed-income securities to be aware of restrictive covenants. This is because restrictive covenants...

Embedded Options in Fixed income Securities

Options and derivatives are generally associated with equity securities. It is for this reason that most investors are not aware...

Zero-Coupon Bonds: Pros and Cons

Zero-coupon bonds are those bonds that are sold at a deep discount to their face value. This means that these...

Step Up Bonds: Pros and Cons

Step-up bonds are special types of fixed income instruments. They help investors partially offset the risks of rising interest rates....

Payment in Kind Bonds – Advantages, Disadvantages and its Types

In the past few articles, we have studied about different types of coupon payments. These coupon payments vary from each...

Treasury Inflation-Protected Securities (TIPS)

Investors who hold bonds generally earn a fixed nominal rate of return. However, the nominal return that they earn is...

What is Convertible Debt?

The fixed-income security market is mostly composed of financial instruments which offer a fixed stream of income to investors. In...

Advantages and Disadvantages of Convertible Debt

In the previous article, we studied the concept of convertible debt and some of the common terms which are used...

Accounting for Convertible Debt

In the previous article, we have established the fact that convertible debt is advantageous to some types of companies. We...

High Yield Bonds

The international bond market is a large and diverse market. There are various categories of bonds that are issued in...

Advantages and Disadvantages of High Yield Bonds

In the previous article, we understood about how high-yield bonds have emerged as one of the biggest market segments in...

Preferred Shares: An Introduction

Whenever the topic of fixed income securities is considered, the obvious assumption many investors make is that the conversation is...

Advantages and Disadvantages of Preferred Shares

In the previous article, we understood what preferred shares are and also paid attention to their characteristic features. In this...

Covered Bonds

Asset-backed securities have become famous all over the world in the past few years. The largest market for asset-backed securities...

Conditional Pass-Through Covered Bond

In one of the previous articles, we studied about covered bonds. We discussed how covered bonds are considered to be...

Why do Investors Hold Fixed Income Securities?

The bond market is much larger in size as compared to the equity markets of the world. This is because...

What are STRIP Bonds?

STRIP is an acronym that is commonly used to denote Separate Trading of Registered Interest and Principal of securities. This...

What are Sustainability Bonds?

Finance and sustainable business practices have traditionally been considered to be separate fields. It was common for companies all over...

Pandemic Bonds

The recent coronavirus pandemic has fundamentally changed the way in which individuals, organizations, and even nations manage their finances. Most...

Municipal Bonds

We already know that bonds are issued by a wide variety of entities. Bonds are routinely issued by corporations, banks,...

What are Eurobonds?

The Eurobond market is one of the largest debt markets in the world. It comprises a large portion of the...

Yield To Maturity (YTM)

Yield to maturity is a fundamental concept which every bond investor must be aware of. The term yield to maturity...

Yield to Call

In the previous articles, we have studied the concept of yield to maturity. We now know how to calculate the...

Inverted Yield Curve

Most investors across the world are aware of the fact that yield curves are generally upward sloping. This is because,...

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Articles on Fixed Income Securities