bonds types
This article describes how to classify bonds. So, there are some basic ways to classify bonds types:
By the issuer
By maturity bonds
In order of bond ownership
Target Loan
By way of covering (maturity) nominal value
Let's examine each of these types of classification.
Types of bonds:
Depending on the issuer (the organization that issued bonds) the following types of bonds:
Government bonds. These are bonds that are issued by the state.
Municipal bonds. These are bonds that issue municipal or local authorities under municipal ownership. The purpose of municipal bonds is to finance various municipal projects. The income from these bonds is generally exempt from tax.
Corporate bonds - bonds issued by private corporations to raise funds. Typically, these bonds are issued against property or assets of the corporation.
Foreign bonds - are bonds that are issued in the domestic market of another country. The main difference between this type of bonds from the rest is the following things: taxation, methods of placement of bonds, regulating the maximum dimensions of the issue and the time, some of the limitations of potential investors.
Bonds can also be classified according to the period for which they are issued. The following types of bonds:
Bonds with a fixed maturity date. These bonds, again, can be divided into three types: short-term (maturity up to 1 year), medium-term bonds (maturity of 1 to 5 years) and long term (with a maturity of 5 to 30 years)
The bonds have no fixed maturity date. The bonds are divided into perpetual (not redeemable), callable bonds (which the issuer can claim up to maturity, and the conditions on which the review is made bonds are defined in advance), with the right of redemption (allow the investor to return the bond to maturity, at the request of the investor) , extended bonds, which allows the investor to extend the repayment period, and to continue to receive interest income from securities and deferred bond (which allow the issuer to defer repayment).
bonds types are also classified in the order of possession bond. The following types:
Issued bonds. Ownership of such bonds are confirmed by recording the name of the buyer in the log book maintained by the issuer.
Bearer. Ownership of which is directly supported by the presentation of the bond.
Bonds can also be divided according to purpose of the loan. The following types of bonds:
Conventional bonds. The purpose of the bonds is to raise finance for the issuer. In this case, the funds will be used for various events.
Target bonds. The funds from the sale of these bonds will be used strictly for a specific purpose.
Bonds also divided into several types depending on the method of payment:
Lump sum repayment.
With maturity, timing. These bonds over a period of time paid off only part of the face value.
