Some variants are:
- Zero-coupon bonds
Those bonds that does not give fixed interest payments but are sold at deep discount of the maturity (par / face) value. In other words, you don't get the fixed interest payment but do get them at maturity as these interest are paid in terms of the discount, and you only get them at the end of the maturity. - High Yield / Junk Bonds
These are in fact from the name itself, junk bonds. They do not provide any security in default payment and the company selling such bonds gives high interest as their credit rating is lower than BBB in general.
Some Risks of Bonds includes:
- Interest Rate Risk (when interest rate increase, bond's market price will drop and the inverse if true)
- Reinvestment Risk (you can't be sure if you can reinvest the interest payment in a interest rate of something similar)
- Timing / Call Risk (if you bond has a call option that the issuer can redeem your bond before maturity, you'll lose all future income when the market interest rate drops)
- Default Risk (the issuer may go bankrupt like Lehmen Brothers, or may be unable to pay off your interest / the maturity value on a temporary or permanent basis.)
- Liquidity Risk (If the market lacks people that are willing to buy over your bond readily, you may face such problem if you needs the money and is unable to sell your bond.)
- etc...
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