There are many kinds of bonds, which can be divided into many categories according to different standards.
Bonds can be divided into government bonds, financial bonds and corporate bonds according to different issuers.
The first type is the bonds issued by the government, called government bonds, whose interest is tax-free. Among them, the bonds issued by the central government are also called government bonds or treasury bonds. The purpose of issuing bonds is to make up the fiscal deficit or invest in large-scale construction projects; Bonds issued by local government institutions at all levels, such as cities, counties and towns, are called local government bonds, which are mainly issued to raise funds for local construction, so they are bonds with a long term; There is another type of government bonds called government guaranteed bonds, which are mainly used to raise funds for the construction of some municipal projects and public facilities by some enterprises directly related to the government; For bonds issued by companies or financial institutions, the issuance of these bonds is guaranteed by the government, but they do not enjoy the interest tax exemption treatment of central and local government bonds.
The second type is bonds issued by banks or other financial institutions, which are called financial bonds. The purpose of issuing financial bonds is generally to raise long-term funds, and the interest rate is generally higher than the bank deposit interest rate in the same period, and the bondholders can transfer funds at any time when they need them.
The third type is corporate bonds, which are issued by non-financial enterprises for the purpose of raising long-term construction funds. They are generally used for specific purposes. According to relevant regulations, enterprises must participate in credit rating before issuing bonds, and the bonds can only be issued when the rating reaches a certain standard. Because the credit level of enterprises is not comparable to that of financial institutions and governments, corporate bonds are relatively risky, and their interest rates are generally high.
According to the length of the repayment period, bonds can be divided into short-term, medium-term and long-term bonds
The general classification standard is short-term bonds with a maturity of less than one year, long-term bonds with a maturity of more than 10 years, and medium-term bonds with a maturity of between one and 10 years.
According to the different payment methods of interest, bonds are generally divided into interest bearing bonds, discount bonds and ordinary bonds.
Interest bearing bonds are medium - and long-term bonds with coupons of each term attached to their bonds. The coupon holder can receive interest at the specified place and at the specified interest amount according to the specified time limit. Coupon usually takes 6 months as a period. Since it can obtain interest income at maturity, coupon is also a kind of securities, so it can also be circulated and transferred. Discount bonds are sold at a discount rate lower than the face value at the time of issuance, and the holder still receives the principal and interest at the face value at the time of maturity. The difference between the face value and the issue price is the interest; In addition, ordinary bonds are issued at a price not lower than the face value, and the bondholders can receive the interest in installments and batches as required or recover the principal and interest at a time after maturity.
Bonds can be classified into public offering bonds and private placement bonds according to whether they are publicly issued or not.
Public offering bonds refer to the bonds that are publicly issued on the market according to legal procedures and with the approval of the competent securities authority. The issuing objects are unlimited. This kind of bond is issued to a large number of investors, so the issuing subject must abide by the information disclosure system and provide investors with a variety of financial statements and materials to protect the interests of investors and prevent fraud. Private placement bonds are bonds issued by issuers to a small number of investors with specific relationships for the purpose of raising funds. The issuance scope of this bond is very small. The majority of its investors are banks or insurance companies and other financial institutions. It does not adopt the public reporting system. The transfer of bonds is also subject to certain restrictions. The liquidity is poor, but its interest rate is generally higher than that of public bonds.
Bonds can be classified into credit bonds and guaranteed bonds according to whether they are secured by mortgage or not.
Credit bonds, also known as unsecured bonds, are bonds issued solely on the credit of the bond issuer and without collateral as a guarantee. General government bonds and financial bonds are credit bonds. A few companies with good credit can also issue credit bonds, but they must sign trust contracts to restrict the issuer's relevant behaviors, and the entrusted trust and investment companies will supervise the implementation to protect the interests of investors. Guaranteed bonds refer to bonds issued with mortgaged property as guarantee. Specifically, it includes: mortgaged corporate bonds issued with real estate such as land, houses, machinery and equipment as collateral, mortgaged trust bonds issued with the company's securities (stocks and other securities) as collateral, and underwriting bonds guaranteed by a third party to pay principal and interest. When the issuer of the bond is unable to fulfill the obligation of repaying the principal and interest when the bond is due, the bond holder has the right to sell collateral to pay off or require the guarantor to assume the obligation of repaying the principal and interest.
Bonds can be classified into registered bonds and bearer bonds according to whether they are registered or not.
Registered bonds refer to the bonds that are marked with the name of the creditor on the face of the bonds and also registered in the account books of the issuing company. When transferring registered bonds, in addition to the delivery of the bonds, it is necessary to endorse the bonds and change the name of the creditor on the company's account books. Bearer bonds refer to bonds that do not indicate the name of the creditor on the face of the bonds and do not register its name in the company's account books. Nowadays, bearer bonds are generally in circulation on the market.
According to the time of issuance, bonds can be classified into newly issued bonds and existing bonds according to the time sequence of issuance.
The newly issued bonds refer to the newly issued bonds, which have a recruitment date. Existing bonds refer to bonds that have been issued and delivered to investors. Once the new bonds are delivered, they become the existing bonds. The existing bonds can be purchased at any time in the securities trading department, and the purchase price is the current market price, and the buyer also needs to pay a handling fee.
According to whether convertible or not, bonds can be divided into convertible bonds and non convertible bonds.
Convertible bonds are bonds that can be converted into other financial instruments under certain conditions, while non convertible bonds are bonds that cannot be converted into other financial instruments. Convertible bonds generally refer to convertible corporate bonds. The holders of such bonds can convert their bonds into stocks according to their own wishes under certain conditions.
