对债券的基本认识.docVIP

对债券的基本认识 Overview of what is a bond and why they are seenn ● 张美霓 Flavia Cheong 　　A bond is a long term debt security. It represents debt because the investors ac-tually lend the face amount to the bond is-suer. However, unlike loans, bonds can be traded in the open market, ie. the investor need not hold it to maturity or suffer a pe-nalty should he choose to sell the bond. 　　A typical bond (plain vanilla) specifies: 　　－the amount of the loan. The face a-mount or par value is the amount that the bond issuer has agreed to repay. A typical face amount is S$1,000 for bonds issued by the Singapore government; 　　－a fixed date when the principal is due. The date on which the principal is required to be repaid is called the maturity date; 　　－if the bond is secured by a collateral. Investors of the Orchard 300 bond issued by Hallgaden Investment Pte Ltd ( a joint venture between Singapore Press Holdings and Lum Chang) have the first legal mort-gage rights to The Promenade, a commer-cial property at the heart of Orchard Road. 　　-The contractual amount of interest which is paid out either every six months or annually. The coupon rate is deter-mined largely by market conditions at the time of the bonds sale. Once determined, it is set contractually for the life of the bonds. However, some bonds have interest rates that fluctuate during the life of the bond, usually at a spread over a reference rate. These are called variable rate bonds or floating rate notes (FRN). 　　One example of a fixed rate bond is the Singapore Government Bond 4.5% 03/00, the issuer is the Government of Singapore, the interest payable is 4.5%. The SGBs coupon is payable on a semi-annual basis, i.e. the Singapore Government will pay the investor 2.25% of S$1,000 or $22.40 every six months. The government promises to repay the principal in March 2000 to the investor. On the other hand, the DBS Land 4/00 FRN pays a coupon of 35 basis points over the 6 months Singapore dollar swap rat