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Fixed Income

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Low risk Absolute return

What are Fixed income?

A Bond is a debt instrument that is a contract between the issuer of debt and the debt holder (also called "investor"). Bonds must have specifically defined maturity dates, interest rates, and other benefits. Also, interest payment dates and redemption dates/principal payment dates must be specified at time the bond is issued in addition to the maturity period. Bonds are transferable and can be traded.

Bond issuers are borrowing from the bond buyer, so the issuer is the "debtor" while the buyer is the "lender" or "creditor." Being debt, bonds are unlike equities or common stock, where investors buy shares which represent ownership in a company.

“Debt instrument” is a broadly used term. But, in Thailand “bond” is often used to refer to debt instruments issued by governments or state enterprises, while “debentures” are most often issued by private companies. In other countries, "bond" may refer to debt issued by both government and private entities, while debt instruments unsecured by collateral are referred to as "debentures."

Types of Fixed income

Government bonds

Debts issued by Thai government with maturity of one month up to 50 years.

Central bank bonds

Debts issued by the Bank of Thailand with maturity of 14 days up to five years.

State enterprise bonds

Debts issued by state enterprises, either with or without guarantees by the Finance Ministry.

Corporate bonds

Debts issued by corporations usually with a maturity of one year to 10 years.

Advantages of debt instruments

Low investment risk

Relatively low investment risk subject to issuer’s credit.

Definite rate of income

Definite rate of income which is usually higher than banks’ deposit rates.

Fixed Investment periods

Fixed investment periods to match investors’ preference.

For use as collateral

For use as collateral, government bonds are generally accepted as guarantees.

Comparative Chart
Return / Risk Of each type of investment.

The correlation of
bond prices and bond yields.

Commission & Fee

For retail investors and non-institutional investors

Taxation on Bond Investment

For retail investors and non-institutional investors

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