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There is one key difference between bonds and bond ETFs to be aware of, however. Explore our site now and save your favorite products, insights, and/or documents. 8 Finance Street, Central, Hong Kong) is licensed by the Securities and Futures Commission for Types 1, 4 and 9 regulated activities under the Securities and Futures Ordinance. With a vast array of maturities, yields and credit quality available, investing in corporate bonds has the potential to provide higher yields than government bonds and diversification benefits for investors. Find information on government bonds yields and interest rates in the United Kingdom. Corporate bonds  |  All rights reserved. Corporate bonds can offer a range of potential benefits including: Similar to government bonds, corporate bonds are exposed to interest rate risk. In return you receive interest and the issuer promises to pay back the loan on a specified date. Instead, the company pays the investor a rate of interest over a period of time and repays the principal at the maturity date established at the time of the bond’s issue. The investment-grade category has four rating grades while the speculative-grade category is comprised of six rating grades. A company determines how much it would like to borrow and then issues a bond offering in that amount; investors that buy a bond are effectively lending money to the company according to the terms established in the bond offering or prospectus. Dan Ivascyn, Group CIO, highlights the attractive opportunities we are anticipating over the next three to five years across the global risk markets and where we are poised to deploy capital. Aggregate Bond Index and S&P 500 Index), showing that active managers outperformed passive managers and benchmarks for fixed income but not for equities. All material contained on the Exchange-Traded Funds section of this website is purely for informational purposes only and is not intended as investment advice. There is no guarantee that the principal amount of the investment will be preserved, or that a certain return will be realized; the investment could suffer a loss. Alan Cubbon suggests they should not overlook the far more diverse dollar … Gilts  |  UK insurers may be tempted to invest in sterling corporate bonds in order to capture some extra yield over gilts. Pacific Investment Management Company LLC, Shareholder Services TEL: 800-927-4648 6AM - 4PM PST, Gurtin Municipal Bond Management, a PIMCO Company, TEL: (858) 436-2200 FAX: (858) 436-2201, TEL: +44 (0) 20 3640 1000 FAX: +44 (0) 20 3640 1007, Shareholder services TEL: +44 (0) 20 3640 1407 9AM to 5PM, Registered in UK and Wales, Company No. Higher-rated bonds, in particular, have a low chance of default. The services provided by PIMCO (Schweiz) GmbH are not available to individual investors, who should not rely on this communication but contact their financial adviser. Our website offers information about investing and saving, but not personal advice. Qualifying corporate bond (QCB) Related Content Debt securities that are exempt from tax on chargeable gains so that their disposal does not give rise to any chargeable gain or allowable loss for the … A corporate bond is debt issued by a company in order for it to raise capital. Invests in high credit quality debt securities in AAA-rated and equivalent … Diversification does not ensure against loss. Portfolios that invest in such securities are not guaranteed and will fluctuate in value. 199804652K) is regulated by the Monetary Authority of Singapore as a holder of a capital markets services licence and an exempt financial adviser. 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