Public issuance of bonds refers to bonds that are publicly issued to social investors with the approval of the securities authorities in accordance with legal procedures. For issuers, that is, enterprises, its shortcomings are high credit rating requirements, high information disclosure requirements, high issuance costs and long issuance time. Its advantage is that it helps to further enhance the credit rating of enterprises. With the change of bond price brought by the change of interest rate, enterprises can buy their own bonds in the secondary market and redeem them in advance. There is no need to repay the principal and interest in full at maturity. For example, when the price of a public debt with a face value of 65,438+0,000 yuan falls to 92 yuan, the issuer can buy it by itself, so as to achieve the purpose of early redemption and pay less 8 yuan principal and future interest. For investors, the biggest advantage of national debt is liquidity, which not only makes its asset allocation more flexible, but also obtains double benefits through price fluctuation and interest; The disadvantage is that the interest rate of public debt is generally not as high as that of private debt. The higher the credit rating, the lower the interest rate, sometimes even worse than the bank interest.

Private placement bond refers to bonds issued to a specific minority of investors. The issuance procedure is simple and generally cannot be publicly traded. For issuers, that is, enterprises, the advantages are low issuance cost, low qualification standards for issuing bonds and low information disclosure requirements, which is conducive to establishing strategic cooperation with institutions in the industry. The disadvantage is that the interest rate is high, and the principal and interest are paid strictly according to the contract. Generally, it cannot be redeemed in advance. For investment institutions, the purpose of buying private placement bond is generally not to resell, but to keep it as a financial asset. The advantage is high interest rate, but the disadvantage is poor liquidity and higher risk than public debt.