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Bonds

Trade the best government and corporate digital bonds on the world’s stock exchanges. Choose the best assets to diversify your portfolio!
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What are bonds?

Bonds are debt installments. Buyers purchase these securities, and then their funds are transferred to the company or the government for its use. At the same time, buyers constantly receive interest payments, as well as the entire amount back on the maturity date (always indicated in advance).

What are the advantages of bonds?

Minimal risks when investing in this asset (lower than when buying shares).
The profit on bonds is usually known in advance and can be easily calculated.
The price of bonds does not fluctuate much and it is easy to sell them at a price close to nominal.

How to trade bonds?

To trade any asset, you need a solid strategy. For medium and long-term bond trading, strategies based on fundamental analysis are often used. There are many different strategies, some of the most popular are the passive method and interest rate trading.
  1. Passive method – is when investors buy bonds and hold them until maturity. Market participants get rid of low-demand securities and hold only liquid bonds.
  2. Interest rate trading is based on the fact that long-term bonds depend on potential trades. Participants enter short and medium positions ahead of the release of monetary policy reports.
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Types of bonds

There are several parameters by which bonds are calculated:
By maturity:
Short-term (maturity less than one year)
Medium-term (1-5 years)
Long-term (more than 5 years)
By the form of payment of profit:
Interest-bearing bonds - Buyers receive one or more interest payments of the par value.
Discount bonds - when purchased, they often cost below par, but are redeemed at it. If you bought bonds for $ 800, and its face value is $ 1000, then you will receive the entire face value, $ 1000.
By issuer:
Government bonds - the country produces them to cover the budget deficit.
Corporate bonds - companies issue them in order to get funds to finance their activities.

Risks of trading bonds

Even the most reliable asset, such as bonds, has its own risks. The risks associated with trading bonds are mainly related to the fact that they may be outstanding due to the fact that the issuer went bankrupt.

Short-term securities are less susceptible to this, as traders need to calculate the prospects of bonds in a short time. So, in order to protect yourself more from possible risks, you should first study the ratings and financial indicators of the issuer.

Government bonds are considered one of the safest, since the possibility of bankruptcy of an entire country is less than the bankruptcy of a company.
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