Bonds

Bonds are fixed-income instruments that typically provide regular interest payments to investors. Most bonds pay fixed interest at regular intervals, except zero-coupon bonds and floating-rate bonds. They can be used to generate income and add stability within a diversified portfolio.

Investors can trade a variety of bonds, including government bonds, high-grade bonds and high-yield bonds. The range allows investors to choose based on their preferred level of risk and return.

Bonds may provide a regular income stream through scheduled interest payments. They can also help diversify a portfolio by reducing concentration in any single asset class. Additionally, the wide range of available bonds allows investors to align their choices to different risk appetites.

Bond investments carry default risk, where an issuer may fail to meet payment obligations. They also carry price and interest-rate risk, as bond prices move inversely to interest rates. Credit risk is another factor, as declines in an issuer's credit quality can reduce bond prices. The risks described are illustrative examples of common bond investment risks and do not constitute a complete or exhaustive list of all possible risks.

Bond prices tend to move inversely to interest rates. When interest rates rise, bond prices typically fall, and when rates fall, bond prices generally increase. This relationship affects the market value of existing bonds.

High-grade bonds are issued by entities with stronger credit quality and are typically preferred by conservative investors. High-yield bonds are issued by entities with lower credit ratings and are suited for investors with higher risk appetites seeking potentially higher returns. It is advisable to conduct thorough market research and, where applicable, seek financial advice before investing.

Customers need a Basic Trading Account to begin investing in bonds. You may either submit an online application using MyInfo or an offline application by dropping it off in-person or sending it by mail to:

OCBC Securities Investors Hub
18 Church Street
#01-00 OCBC Centre South
Singapore 049479

Investors have access to OCBC’s credit research reports, including Asian Credit Daily reports. These resources help investors stay informed about market developments and issuer credit quality.

Bonds act as an alternative asset that could help reduce risk concentration within a portfolio. By including bonds, investors can balance risk across different investment categories. Bonds may also offer income and stability, which complement other investment types.

Customers can reach OCBC Securities through the enquiry form, by telephone, or by contacting your Trading Representative.