Global Bond
Categories: Bonds, International, Forex
Are you a global traveler? Well, bonds can be, too.
Global bonds are bonds that are of one currency, but are traded and sold in foreign markets.
For instance, a USD bond sold on a European market is a global traveler...er, global bond (these specifically are sometimes called “Eurobonds”). Likewise, a European bond sold in a Japanese market is a global bond.
Why are bonds crossing borders in the first place? Smart investors like to have some safer investments (bonds) and don’t want to keep all of their eggs in one basket (diversification means tapping the foreign market, no matter what country you’re in). If you can’t be a global traveler right now, well, you can start by getting your hands on a global bond at least (and live vicariously through it).
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Finance: What are Bonds?393 Views
Finance a la shmoop what is a bond? well a bond is your word your promise your [Women shake hands]
handshake your John Hancock on a contracted piece of paper your mortgage
your credit card debt yeah their bonds to your "I swear I'm not a deadbeat"
declaration... that's your bond right well bonds come [Man lying on a sofa]
in many complex flavors and compositions simply put bonds are loans aka debt you
borrow money or you promise or you you bond that
you'll pay it back when you borrow money the amount you borrow is called the
principal you pay rent on that amount borrowed and that rent is called [rent appears at bank]
interest to the entity loaning you the money that interest is called yield
thank you very much for the yield like if the lender rents you a grand for a
year and you pay them a thousand 80 bucks at year-end paying back the
principal and then the rent on the money while the lender will have had a yield [Yield of lender appears]
of 8% on the grand that they loaned you so that's a bond you borrow money you
pay it back and if you don't the person who loaned you the dough well they [Person stamped with property of shmoop bank]
generally own your tuchus and yeah you know what Shakespeare said about bonds
yeah that's what he said so if you don't really know what you're doing don't do
it...