Unlike the stock that gives ownership to the holder, the bond is actually a loan you give to a company. Bonds are long-term debt issued by a company or government with a nominal value (par value/par value) and a certain maturity. Because you are giving a loan to a company or government, the borrower (the company or the government) will repay the loan plus the interest for a certain period of time. In the meantime, you can also check out ft Lauderdale bail bonds to hire a fine service to help your investment.
Coupon bonds with fixed interest rates during the period of validity are among the types of bonds traded in the Indonesian capital market today.
Bonds are a type of long-term investment. The capital to be spent on bond investments is relatively large enough for individual investors. The value of bonds is traded usually in units large enough, such as Rp. 5 Billion. The period of validity of the bond depends on the institution or body that publishes it, generally between 5 to 10 years. The shorter the duration of bonds, the less the effect on the interest rate. The longer the duration the more sensitive to changes in interest rates. You can sell the bonds you have on the other hand in the secondary market in accordance with market value or price before the bond matures.
Changes in bond prices in the market are strongly influenced by changes in interest rates and perceptions of risk. Bond prices in the stock market may be higher or lower than their par value. Investing in bonds not only benefits from fixed interest (coupon) payments, but you also have the opportunity to profit from capital gains (the difference between buying and sell). A bond may be traded at any time (before maturity) at a price more or less than its par value, depending on market conditions. Anyone who has a bond at maturity will get a refund of the amount of the par value. Bond prices may fluctuate due to several things, such as the interest rate paid on the bond, the level of certainty of repayment or overall economic conditions, especially the rate of inflation affecting the interest rate of the bank.