For purchases by financial institutions, relevant financial institutions (commercial banks with legal person status in China and other financial institutions or their authorized branches, etc.) can purchase through the inter-institutional bond trading market.
For individual purchases, individual investors have no way to directly participate in the primary bidding or secondary trading of inter-bank bonds. Individual investors can participate indirectly by investing in public funds. It is still difficult to use public funds to invest in Huawei's bond issuance.
Bonds are securities issued by debtors such as governments, enterprises, and banks in accordance with legal procedures to raise funds and promise to repay principal and interest on a specified date.
Bonds (Bonds/debenture) are a kind of financial contract. They are issued to investors when the government, financial institutions, industrial and commercial enterprises, etc. directly borrow money from the society to raise funds. At the same time, they promise to pay interest at a certain interest rate and repay the principal according to the agreed conditions.
Debt certificate.
The essence of a bond is a certificate of debt, which is legally binding.
The relationship between bond buyers or investors and issuers is a creditor-debt relationship. The bond issuer is the debtor, and the investor (bond buyer) is the creditor.
A bond is a marketable security.
Because the interest on a bond is usually determined in advance, a bond is a type of fixed-interest security (fixed-rate security).
In countries and regions with developed financial markets, bonds can be listed and circulated.
Although there are many types of bonds, they all contain some basic elements in content.
These elements refer to the basic content that must be stated on the issued bonds. This is the main agreement that clarifies the rights and obligations of creditors and debtors. Specifically, they include: The par value of the bond refers to the par value of the bond, which is the issuer’s obligation to the bondholder on the bond.
The amount of principal that should be repaid upon maturity is also the basis for the company to calculate interest payments to bondholders on schedule.
The face value of the bond is not necessarily consistent with the actual issuance price of the bond. An issuance price greater than the face value is called a premium issue, a price less than the face value is called a discount issue, and an equal price issue is called a par issue.
The bond repayment period refers to the period specified on the corporate bond to repay the bond principal, that is, the time interval between the bond issuance date and the maturity date.
The company must determine the repayment period of corporate bonds based on its own capital turnover status and various influencing factors in the external capital market.
The interest payment period of a bond refers to the time for interest payments after the company issues the bond.
It can be paid once upon maturity, or once every year, half a year or three months.
Taking into account the time value of money and inflation, the interest payment period has a great impact on the actual return of bond investors.
The interest on a bond that pays interest once upon maturity is usually calculated as simple interest; while the interest on a bond that pays interest in installments during the year is calculated as compound interest.