Corporate Bonds

A corporate bond is a debt security issued by a corporation to raise capital, and it pays a fixed rate of interest over a set period of time. When an investor buys a corporate bond, they are effectively lending money to the company in exchange for the promise of regular interest payments and return of principal at the end of the bond's term.

One advantage of investing in corporate bonds is that they typically offer higher yields than government bonds or other fixed-income securities, which can provide a reliable source of income for investors. Additionally, corporate bonds can provide diversification benefits for investors, as they are not directly tied to the performance of the stock market.

Get Started

This has been traditionally a bit of a tricky investment for non-accredited investors however there is a good platform anyone can start investing with Wisealpha They have listings of many companies that offer bonds at rates typically between 4%-8% depending on their risk rating and length of time for the bond. You can spend small amounts of money to buy just a small portion of the bond. The issuer promises to pay a fixed rate of interest or coupon for a fixed period at regular intervals until maturity, upon which they will repay the original loan or capital back to the investors (bondholders).

Wisealpha has a good tutorial their Bond academy that will explain in every detail everything you would need to know

Snapshot

Why should you invest in this? A reasonably safe investment with higher returns than government bonds

Percentage of portfolio to invest? 5%-10%

Our Risk rating? With diversification over several companies 4/5

Our overall rating? 4/5

How do I start? WiseAlpha