Corporate Bonds and Covered Warrants
A corporate bond is a debt instrument issued by a private or public corporation. Corporate bonds are rated by credit rating agencies. They assign ratings based on a company's perceived ability to pay its debts over time. Those ratings - expressed as letters (AAA, AA, A, etc.) - help determine the interest rate that company or government has to pay. A bond with a rating below BBB is considered a high yield or "junk" bond. Such bonds pay higher interest rates but have greater risk of default. Corporate bonds have historically been viewed as safer investments than stocks. The main reason for this is the prior claim corporate bond holders have on a company's earnings and assets.
See our daily updated table of UK savings bonds products.
Covered warrants give private investors access to some of the financial mechanisms that have helped hedge funds turn in a profit, despite plunging stock markets. They allow you to make profits when markets are either falling or rising.
Covered warrants give you the right (but not the obligation) to buy or sell a share at a specified price during, or at the end of, a set time period – anytime within three months or three years. You can link covered warrants to a particular index or an individual company share.