What is a Debenture Issue?

Secured copororate bonds are backed by an asset or collateral. When a bond is secured, it is backed by collateral. That collateral could be cash, securities, real estate or equipment.

Corporate bonds can be callable by the issuer. Call dates can be placed on the bond and this allows the company to redeem the bonds early beginning on set dates and at set redemption prices. This is normally not a good feature for investors, because an issue is normally called when interest rates are low - lower than your coupon rate. The main reason debentures or bonds in general are called, is because the issuer wants to refinance their debt at a lower rate. When this happens, the investor is faced with having his money (par) returned early, but the higher paying bond is no more. To make matters worse, interest rates are lower in the market, so finding a suitable replacement will be difficult, if not impossible. Callable bonds to pay a higher yield though, so for some the risk is worth it.

Recommended Book Titles on Corporate Bonds

Corporate Bonds: Structure and Analysis - Corporate Bonds: Structures and Analysis covers every aspect of corporate bonds, including bond structures, credit analysis, and investment strategies. This book discusses state-of-the-art technology for valuing corporate bonds, as well as innovative new products such as step-up notes and range notes. Complete with contributions from today s top financial experts, Corporate Bonds is the definitive reference for this vital market.

Corporate Bonds and Structured Financial Products - This book is a detailed account of the instruments that are used in the corporate bond markets, from conventional "plain vanilla" bonds to hybrid instruments and structured products. There is background information on bond pricing and yield, as well as a detailed look at the yield curve. The book covers the full set of instruments used by companies to raise finance, and which are aimed at a wide range of investors. It also discusses the analysis of these instruments.

Corporate Bond Markets : Instruments and Applications (Wiley Finance) - A comprehensive look at all aspects of the global bond markets A guide for both issuers of funds and investors, Corporate Bond Markets gives practitioners a global perspective on the bond markets and practical aspects of issuance and investment. This unique perspective makes this book unlike any other on the topic. With practical worked examples and illustrations taken from actual market circumstances, readers will find one-of-a-kind coverage of the latest development in structured finance, including the vital topic of valuation. Moorad Choudhry (London, UK) is a Senior Fellow at the Center for Mathematical Trading and Finance, CASS Business School, London. He is also Editor of the Journal of Bond Trading and Management and the author of Bank Asset and Liability Management

Managing a Corporate Bond Portfolio - As a Senior Portfolio Manager responsible for managing billions of dollars invested in fixed income product during the mid-1990s, Lee Crabbe was the one Wall Street strategist that I would read every week to help me figure out where value was in the corporate bond market, and for insightful and easy-to-understand special reports that educated me and most investors on the risks and opportunities inherent in new structures and subordinated products. Fortunately for me and investors, Lee Crabbe and Frank Fabozzi have written this book, which compiles much of their previous work on corporate bond valuation, along with new features that are a must read, especially in light of the volatile times in the corporate bond market over the past few years. For portfolio managers, analysts, traders, and even strategists, if there is one book in your bookshelf that you should have on corporate bond portfolio management, it is this one.