Types of Bonds by Edu Pristine

Author of lecture Types of Bonds

Edu Pristine

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... The sale price varies for each successful bidder, depending on the bid price. Most government bonds are issued by this method. Dutch Auction: The securities are allocated to bidders starting with the highest bid. The price at which the final allocation is made becomes the price at which all securities are sold. All bonds are sold at the cut-off ...

... unlimited or limited taxing power. For example: bonds issued by government hospitals or schools are often financed by taxes collected by the government. Revenue bonds: The principal and interest payments are secured by the revenues generated by the operating projects financed with the proceeds ...

... on its maturity date, to make their debt issue more palatable to investors. Sinking fund is a pool of money put aside to form the proceeds used in the repayment of a fixed-term bond. Call Provision: A provision on a bond that allows the original issuer to repurchase and retire the bonds. A large number of corporate bonds, especially in the US market, have this provision. Borrowers prefer this as it enables them to refinance debt at cheaper rates when market interest rates have fallen significantly below ...

... a credit premium and might be priced higher than government bonds. Agencies are differently organised. Fannie Mae, Freddie Mac and Sallie Mae are owned by private-sector shareholders. The FCS and the FHLBS are cooperatives owned ...