It depends what you choose for report Essay Example | Topics and Well Written Essays - 2250 words

It depends what you choose for report - Essay Example It is a market where debt securities are issued and traded, the instruments of bond market include govt issued securities (like saving bonds, treasury bills and notes), and corporate debt securities, (like CDs, municipal bonds, preferred stocks, and zero-coupon securities). It is one of mean that move the savings from saver to the issuers or companies who require capital for their ongoing projects or new expansions, this market is presumed to be a market of fixed return, although it appear complex but it is also driven by same risk and return tradeoff as like in stock market, basically bonds market can be divided into three main groupings i.e. issuer, underwriters, and purchaser. (Levitt) The final player in this market include any group or any other type of investor including the individual , further govt often purchase debt from other countries if they have the excess money of that other country’s money as a result of trade between them e.g. japan is a major holder of U S govt debts. Further it is worthwhile to mention that income from bonds is fixed but there are different risk factors that are attached to a bond market, which may include inflation risk, interest rate risk, duration risk, call risk, credit risk, liquidity risk, market risk. (INSTRUMENTS) This form of lending and borrowing is common in corporate sector where if a company need finance for its operation or expansion projects it lend one of its asset to a financial institutes in order to finance these projects then in return they get loan, and after completion of concerned objective they get relieved there asset after paying back there loan amount. Normally people obtain such type of loan from state owned institutions, where each mortgage has its criteria depending upon the market situation, normally company acquire loans through mortgages where they pledge there asset with a bank or a financial institute in order to obtain loan for their expenses and in that case company have to