(3) Convertible bonds, which are characterized in that the purchaser can exchange a corresponding number of shares at the exchange price specified at the time of issuance;
(4) Warrant bonds, which are characterized in that the purchaser can obtain a right (not a responsibility) and buy some other assets according to the agreed terms, similar to call options on related assets;
5. Synthetic bonds have the characteristics of fixed interest rate bonds and interest rate swap contracts.
[Editor] Characteristics of European bond market
Euro bond is a new type of international bond, which is an overseas bond, just as European currency is not traded in the country that issued the currency, nor is it issued in the national bond market in face value currency. (1) The issuer, face value and issuing place of the bonds belong to different countries. For example, the bonds with face value of country D issued by the institutions of country A in the bond markets of country B and country C are European bonds. The main issuers of such bonds are the government, large multinational companies or large commercial banks.
(2) The bond issuance method is mainly syndicated. The bond issuance method is generally led by a large professional bank, a large commercial bank or an investment bank, and is issued by dozens or dozens of large banks in different countries. Most bonds are bought by these banks and then sold in the secondary market or the domestic market where securities are sold.
(3) High degree of freedom. Generally speaking, bond issuance does not need the approval of relevant governments and is not bound by financial laws and regulations of various countries, so it is more free and flexible.
(4) It does not affect the currency circulation in its issuing country. The funds raised by issuing bonds are European monetary funds, not the monetary funds of the issuing country, so the issuance of such bonds has little impact on the monetary capital flow of the issuing country.
5] Strong currency selectivity. Issuing European bonds can not only raise funds around the world, but also be sold in many countries, and you can also choose the bond issuance market and face value currency at will, which has great financing potential. If the borrower can choose to issue bonds in one or more currencies according to the needs of exchange rates and interest rates of various currencies, such as Eurodollar, pound, mark, franc and Japanese yen, investors can also choose to buy any kind of bonds.
(6) The issuance conditions of bonds are more favorable. Its interest is usually exempt from income tax or not deducted from the tax of the borrowing country in advance. In addition, its anonymous issuance can also make investors evade domestic income tax. Therefore, bonds are very attractive to investors, and also enable fund raisers to raise funds at a lower interest cost.
(7) High safety and strong liquidity. The main borrowers in the European bond market are multinational corporations, governments and international organizations. These lending institutions have higher credit ratings, so they are safer for investors. At the same time, the market is an effective and dynamic secondary market, and the securities holder, negotiable bonds, gets cash.
Sensitive to market reaction and low transaction cost. There are Euroclear clearance system Ltd and cedelS.A in the European bond market, which enables the market to accurately, quickly and timely provide the current international capital market's capital supply and demand and interest rate exchange rate trends, shorten bond delivery time and reduce delivery procedures. Traders all over the world can trade quickly based on this, which greatly reduces the transaction cost.
(9) Financial innovation continues. The European bond market is one of the most dynamic markets. It can continuously introduce new or combined products according to the supply and demand situation, thus closely linking the international stock market, bill market, foreign exchange market and gold market, effectively promoting the international financial integration and world economic integration.