Corporate bonds

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Financial Times  Dec 4  Comment 
Expansion plans are in question after a focus on dividends and share buybacks
Mondo Visione  Nov 29  Comment 
2016: Another record-breaking year in number and volume of corporate bonds Vienna gaining significance as a trading venue for international bonds Over 450 corporate bonds issued by 220 companies traded in Vienna  Admissions to...
Financial Times  Nov 15  Comment 
Pfizer completes $6bn sale but recent volatility weighs on interest
Mondo Visione  Nov 3  Comment 
Under a ten year strategic partnership agreement, Euronext and Algomi will form a Joint Venture Special Purpose Vehicle (“JV SPV”), capitalised by Euronext, with technology supplied by Algomi, to improve liquidity in pan-European corporate...
Wall Street Journal  Nov 2  Comment 
There is a fine line between keeping cool and being complacent. Credit markets appear to be skating on it.
Financial Times  Nov 1  Comment 
Surge of takeovers and buyouts fuels uptick in global bond offerings




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A corporate bond is a bond issued by a corporation. It is a bond that a corporation issues to raise money in order to expand its business. The term is usually applied to longer-term debt instruments, generally with a maturity date falling at least a year after their issue date. (The term commercial paper is sometimes used for instruments with a shorter maturity.) Sometimes, the term "corporate bonds" is used to include all bonds except those issued by governments in their own currencies. Strictly speaking, however, it only applies to those issued by corporations. The bonds of local authorities and supranational organizations do not fit in either category.

Corporate bonds are often listed on major exchanges (bonds there are called "listed" bonds) and ECNs like Bonds.com and MarketAxess, and the coupon (i.e. interest payment) is usually taxable. Sometimes this coupon can be zero with a high redemption value. However, despite being listed on exchanges, the vast majority of trading volume in corporate bonds in most developed markets takes place in decentralized, dealer-based, over-the-counter markets. Some corporate bonds have an embedded call option that allows the issuer to redeem the debt before its maturity date. Other bonds, known as convertible bonds, allow investors to convert the bond into equity.

Corporate Credit spreads may alternatively be earned in exchange for default risk through the mechanism of Credit Default Swaps which give an unfunded synthetic exposure to similar risks on the same 'Reference Entities'. However, owing to quite volatile CDS 'basis' the spreads on CDS and the credit spreads on corporate bonds can be significantly different.

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