The terms fixed-income bonds, fixed-income securities, pensions, bonds and debt securities are
often used as synonyms for interest-bearing securities. The SIX Swiss Exchange bond market comprises all
of the classic debt securities from straight bonds to convertible bonds.
Bonds are usually listed as percentages, which means that, unlike shares, they are not traded
as units, but as nominal values. Prices are always given as percentages. They feature fixed
interest rates and predetermined durations and forms of repayment. Hence the purchaser is the
creditor, while in most cases the issuer is the debtor. As investments, bonds basically offer
two forms of income: interests payments from the issuer and price increases.
A bond is a major loan divided into partial sums which conform to one and the
same legal basis. The lender is entitled to redemption of and interest on the provided capital
in accordance with the conditions pertaining to the bond.
Usually, the debtor is liable with the entirety of its assets. The debtor uses bonds as a means to
acquire long-term capital that is cheaper than that which could be obtained through bank loans. The
investor has an easily realisable capital investment that is stable in comparison to equity securities.