5 Advantages Of Investing In Wholesale Bonds
                     5 Advantages Of Investing In Wholesale 
Bonds
Bonds are traded in two ways, wholesale and retail. 
Wholesale bonds are debt securities that can be sold to 
wholesale investors or clients at the time of issue as 
mentioned in the Corporations Act 2001. This can be done 
on the basis that all the appropriate disclosure documents 
are prepared and provided to the investors according to 
the act. These bonds trade in the OTC (over-the-counter) 
market, unlike retail bonds that are traded on an 
exchange market. Investors need a minimum investment 
amount of $250,000 to invest in these bonds. However, 
there are various types of bonds available and people 
should research them before investing.
Planning to invest in wholesale bonds? Here are a few 
advantages of investing in it.
1. Diversification
Gaining access to a wider range of bonds available in 
the market is quite beneficial for the investors as they 
could diversify their portfolios. Wholesale Bonds 
provide the investors the opportunity to diversify their 
investment allocations. This is done by providing the 
company with a huge number of issuers and investors 
with investment opportunities. People are allowed to 
invest in bonds across the globe while entering different 
country markets. This reduces the chances of incurring 
losses and exposes the investors to more opportunities 
in return. 
2. Secondary market liquidity
Wholesale bonds offer the investors liquidity, allowing them to 
trade these bonds in the Secondary Market. There is no 
penalty fee charged while exiting unlike endowments or fixed 
deposits with pre-termination clauses. However, the investor 
would not receive the coupon payments for the rest of the 
bond's tenure and will be returned the principal amount on 
his or her exit. The liquidity of these bonds is based on the 
market and the availability of buyers and sellers.
3. Fixed income
Wholesale bonds allow people to plan their cash flow in the 
various stages of life. These bonds provide the investors with 
predictable cash flows. These cash flows come in the form of 
regular coupon payments. These coupon payments are 
counted as fixed income for the investors till the time of 
maturity. These coupons are generally provided to the 
investors during a pre-mentioned duration. Hence, this factor 
helps the investors enjoy a passive income.
4. Lower risk and volatility 
These bonds are considered safer than investing in stocks as the 
investor receives the principal amount along with regular coupon 
payments. In case of a default, bondholders are paid out before 
the stakeholders of the company as well. Hence, bonds are 
considered to be more stable than the stock market which keeps 
on fluctuating constantly in their investment portfolio. 
5. High yields
Wholesale bonds are given out by companies generally 
pay to double the rate than what fixed deposits provide. 
The investor is provided with coupon payments until the 
maturity period of the bond is reached wherein the 
principal amount is returned. Hence, many investors turn 
towards these bonds as they provide much healthier 
yields than other fixed-income assets. 
We hope that this article helps you understand the 
advantages of investing in wholesale bonds. Thank you! 
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5 Advantages Of Investing In Wholesale Bonds