A Private Sector Bond is a bond issued by corporates with maturity of 1 year or more and denominated in Turkish Lira. Private sector bonds can be either discounted or with coupon.
Features and Advantages
- Private sector bonds provide long-term investment opportunity; regular income may be achieved by coupon payments.
- In addition, due to price difference in trading, there is possibility of obtaining capital gain.
- Private sector bonds can be redeemed within secondary markets before their maturity depending on current market conditions. Higher than expected returns can be obtained in a market where interest rates decline, but the reverse is also possible.
- The minimum transaction amount depends on the type of the private sector bond.
- Issuers of bonds and bills may not be able to repay principal and interest amount on due date and become default. This risk is higher for corporate bonds compared to government bonds.
- You may easily invest in private sector bonds through HSBC Bank Branches.