Introduction to Investment Varieties–Bond&Currency

1、bond

A bond is a security that is issued by the issuer to raise funds, pays a certain percentage of interest at an agreed time, and repays the principal when it matures. It can be issued by the state or by a company.

The yield on bond interest is called the bond rate. Most bonds have a fixed rate, but floating rate bonds are also available. Also, since the bonds themselves are tradable, prices are also affected by supply and demand.

Bonds have risk ratings. Generally speaking, the risk of national bonds of large countries is very low, and the risk of bonds of large companies is also very low, but the risk of bonds of small companies that are close to bankruptcy is relatively high, and of course the bond interest rate is relatively high.

The risk rating of bonds is done by a specialized rating company, which requires a high degree of professionalism. The existing well-known bond rating companies, such as Moody’s, Fitch, and Morningstar, all have decades of history.

2、currency

 

Currency can also be invested. When you think a certain currency will appreciate or depreciate, you can buy or sell it in advance. The appreciation and depreciation of currency are mainly determined by supply and demand.

 

Common ways include:

National currency: that is, the currency issued by the country. The foreign exchange transaction that is often heard is to exchange the national currency of one country with the national currency of another country. In fact, it is a bet on the change of the national currency demand of the two countries. For example, if a country prints a large amount of money, the money supply will increase. At the same time, the country’s economy will decline and productivity will decline, resulting in poor quality and performance of the products produced, higher production costs, and longer production times. There will be fewer people visiting, traveling, and studying, and the demand for the country’s national currency will also decrease. When there is a problem with supply and demand, the country’s currency will depreciate.
Digital currency: Digital currency is still a relatively controversial investment product. Whether it is currency or commodity, there are different opinions, and it is temporarily classified as currency here. Digital currency is not controlled by a specific country and has a high volatility.

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