債券

Why trade bonds with Phillip?

  • Access to more than 70 counterparties worldwide.
  • Access to 9 different currencies globally.
  • Participation in both primary and secondary bond markets globally.
  • Phillip Overseas Offices in 16 countries support price discoveries.

Trading Bonds

Benefits
Stable income stream
  • Regular coupon / interest payments, predictable stream of income
Higher returns
  • Offer higher yields than short term deposit in general
  • Depends on risk appetite
Investment portfolio diversification
  • In terms of investment instrument mix, risk / reward profile, maturity, interest rate & currency exposure
Credit enhancement / sweeteners
  • Bonds may be packaged with guarantee, security.
Risks
  • Market risk - The value of the bond is subjected to interest rate changes, as well as demand and supply forces. Bonds, in particular, are sensitive to interest rate fluctuations and the prices of bonds move in opposite direction with interest rates. Despite this consideration, this risk is more pertinent if the investor decides to sell the bond and not hold it to maturity.Bonds may be packaged with guarantee, security.
  • Credit risk -Credit risk highlights the fact that the issuer may default on payment of the coupon, and even the principal amount if the issuer has problems meeting its obligations as promised. This is also known as default risk or issuer risk.
  • Liquidity risk - When there is a lack of buyers or sellers in the market, the investor may not be able to execute the trade or may be forced to trade at a value significantly away from the investor’s desired price. This can be deemed as liquidity risk.
  • Foreign exchange risk - The investor is exposed to fluctuations in foreign exchange rates when the investor trades in bonds that are denominated in a currency other than the functional currency of the investor. This may erode the returns on the bond investment.

Fees & Charges

For further enquiries about Bonds, please contact your Trading Representatives or email our Fixed Income Desk at fixedincome@phillip.com.sg.