Bonds Alternative Investments Long-term investments

Bonds are securities in the form of a certificate inscribed debt recognition contract on the loan within a certain period issued by the company or government agency as a party that owes a nominal amount.
Simply put, the bond is a testament to a company's debt to the bondholders. In other words, if you buy a corporate bond, you are lending your money to the company.

bond investments

Income from Bonds In exchange for the loan that you give, you will get a fixed interest rate (coupon) of the money you invest.
Flowers that are still generally paid within a certain time, in accordance with the current agreement bond purchases. Unlike the preferred shareholders, issuers are required to pay interest on the bonds despite
is experiencing a loss, so you need not worry that interest will not be paid (unless the issuer is declared bankrupt). Because interest rates on bonds have been determined in advance before, then investing in bonds classified as fixed assets investment.
1. Coupon Yield
The types of coupons is now actually quite diverse. Exist
coupons whose value is determined by the interest rate on deposits, but the fixed rate is the most preferred investor.
Coupon yield is obtained from dividing the amount of the coupon
with a par value. When the value of the coupon is paid issuers is always fixed, then the value of the coupon tield (KY) also remain, because the face value always remains. The formula is KY = Coupon (USD) / Value Pari X 100%
For example, you have a bond that Parinya value of Rp 5,000 and Rp 400. The coupon gives meaning KY your bond is 8% (US $ 400 / US $ 5000 X 100%).
Of the value of the coupon yield is where you can compare
Your bond investments with fixed investment instruments else you have.
2. Current Yield
The opposite of coupon yield, current yield (CY) value
fickle. Current yield is obtained by dividing the value of the coupon at the time the bond price (market price). The formula CY = Coupon (USD) / X 100 Current market value of this yield can be used as consideration in buying bonds in the secondary market. If the current yield (CY)
greater than the coupon yield (KY), meaning that the value of the bond when it is below par prices. When investors buy bonds at the time, he can get an advantage. Because, at maturity, the bonds can be sold at par so that investors will get a capital gain
,
Let us take an example of a case. You now wants
buy bonds PT. EARTH, but you want to compare the first price. Turns bond PT Bumi has a par value of USD 9000 with 10% being CY KY her when it reached 15%. It means that the current bond price of Rp 6,000 (10/15 X Rp 9000), lower than the price of Rp 3,000 par. You then buy the bonds and then sell them at a price of par at maturity. Well, you get a capital gain of Rp 3,000.
Bond Investment Risk
As with any other investment, investment in bonds was not free of risk: The risk of interest rate movements opposite of the stock, bond value is not determined by the performance of listed companies, but is influenced by interest rates umun or government policy.
If interest rates move up, the value of bonds will move
fall, when interest rates fall, the bond's value will rise. Why? Because when interest rates rise, people will be more interested to deposit their money in a much more secure. As a result, the bonds less attractive and the price drops. Conversely, when interest rates fall, people would rather invest their money in bonds, so bond prices will rise. This is in accordance with the law of supply and demand. Therefore, if you are interested in bond investing, you should be more sensitive to changes in the macroeconomic situation.
- The risk of the inability of the issuer to pay interest on the bonds
There are times when the issuer can not pay interest on the bonds, which must be paid to the investor. In such cases, the issuer can be prosecuted and declared bankrupt. To mengghindari this risk, it is important to pay attention to bond ratings.
The term is often used
Zero coupon bonds: Bond interest is paid entirely at maturity
Coupon bonds: Interest on these bonds is given periodically, according to the provisions.
Fixed coupon bonds: the bond interest is paid periodically, and the number has been set before the oblligasi traded.
Floating coupon bonds: Bond interest is determined
before the coupon payment period, in accordance with the current interest rate.
Bail bonds (secured bond): the bonds are secured by certain wealth, so that when the company is liquidated, bondholders will receive payment from the sale of collateral.
Unsecured bonds (unsecured bond): bonds are not secured by assets emitan. Please note, secured bond is not necessarily more reliable (less risk) than on unsecured bond. It is highly dependent on the company issuing the bonds. Unsecured bonds issued by companies that reliable and bona fide certainly less risky than small companies secured bond.
Senior bonds: bonds are prioritized full payment if the company is liquidated. Subordinated bond: if the senior bonds have priority over all their possessions, the subordinated bond is only entitled to a partial replacement.
Flowers: Bondholders generally receive a regular income from their investments in bonds, which are often also called coupon (coupon)
Par value (face value): value of bonds on which the
the determination of interest rates.
Maturity: the date on which the issuer must pay back the investors who have invested money in bonds.
Redemption: return on bonds from investors to
company, either already matured or not.
Retirement: penggudangan against the bond so that issuers can no longer issue such bonds.
Sinking fund: the gradual payment of the value of bonds before maturity.
Callibility: repurchase of bonds by companies
The bonds were issued by various companies, ranging from blue-chips to manufacturers. Usually bonds pay more than government bonds, and can be a good option if you want to invest for the short term. Publisher Bond type:
Government bonds
Namely bonds issued by the government. The risk is much smaller because it is guaranteed, but the coupons (income) were given was small. In accordance with the laws of the investment, the greater the risk, the greater the potential profit is given. Examples oblihasi eg government securities (Government Securities)
Corporate Bonds
As the name implies, these bonds issued by private companies. This is the appeal of bonds offer high interest. Before you buy a bond, both government and corporate bonds, first examine carefully the requirements and guarantees. Taking into account any potential future revenues and risks.
Remember, too, if you want to invest in bonds, train sensitivity to changes in the economic situation (the state budget policy, export and import, and so on), in order to obtain maximum benefit.

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(Source: investasijutawan.com)