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Bonds
Information
What are Bonds?
Bonds are debt securities issued by governments, corporations, or other issuers to bondholders to raise money. Bond issuers will repay the redemption value of the bond upon maturity, and a rate of interest throughout the life of the bond.
Features
Select from a wide range of bonds with various issuers, tenors and currencies
Offer regular interest income throughout the tenor of the bond
Generally pay a higher rate of return than time deposits with a similar tenor. You could benefit from capital appreciation if bond prices move up
Large amount of bonds offers a stable investment with a low risk level within a diversified portfolio. At HSBC,we currently offer bonds and certificates of deposit issued by governments, including China, the US and the Hong Kong SAR, local quasi-government bodies, supranationals, and well-known corporations around the world, denominated in major currencies. There is also a wide selection of tenors or terms from which to choose, from one to 30 years with various benchmark yields
With HSBC's extensive network in the investment community and a strong bond capacity, competitive pricing can be offered. The bonds purchased under HSBC's custody and nominee service ensures all interest earned is credited to your account. You can also manage your bond investments through your monthly transaction summary and transaction history provided
Minimum investment amount is normally HKD100,000*
*The minimum investment amount starts from HKD100,000, depending on the type of bonds and the respective market prices at the point of trading.
HSBC offers different types of bonds:
Types of issuers - corporate bonds , supranational bonds and government/quasi-government bonds
Coupon - fixed rate bonds, floating rate bonds and zero-coupon bonds
Quality - investment grade bonds
Currency - HKD and USD
Tenures ranging from 2 to 10 years and with indicative annualised yields of up to 6.55%#.
# Indicative annualised yield is quoted on 16 March 2006 for reference only. Please consult our customer service representatives for more information.
What factors affect bond prices?
Prices of bonds correlate with the bond yield, which in turn is directly related to the credit risk of the bond issuer. Credit risk is usually measured by credit ratings assigned by international rating companies such as Moody's and Standard & Poor's. Issuers with higher credit risk may pay a higher yield to attract investors. Changes in the credit ratings will be reflected in the yield and the price of the bond.
Remarks:
Please note that all the information above is quoted as at 21 January 2005 for reference only
The price of bonds can and does fluctuate and any individual bond may experience upward or downward movements, and may even become valueless. There is an inherent risk that losses may be incurred rather than profits made as a result of buying and selling bonds
The holder of bonds bears the credit risk of the issuer and has no recourse to HSBC unless the latter is the issuer itself
This information is issued by The Hongkong and Shanghai Banking Corporation Limited. It is based on the information obtained from sources believed to be reliable but we make no representation and accept no responsibility as to its accuracy or completeness and shall not be held liable for damages arising out of any person's reliance upon this information. This information is neither a recommendation, an offer to sell nor solicitation of an offer to purchase any investment products. The information is subject to change without notice
