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APA
Subject:
Business & Marketing
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Essay
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English (U.S.)
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Topic:

Financial Services and Trading Institutions Problems: The Junk Bonds

Essay Instructions:

Financial Services & Trading Institutions Problems
Junk Bonds
1. Why would you (or your company) invest in a non-investment grade (junk) bond?
A bond with a rating by any of the major rating agencies (S&P, Moody's, Fitch) below triple-B are known as Non-Investment Grade or Speculative Grade bonds. However, some of the largest companies in the Fortune 500 - The GAP (#177), Toys R Us (#240), Netflix (#379) - have debt obligations that are rated below investment grade - otherwise known as "junk bonds".
2. What makes "junk bonds" so risky?
3. Why might you may want to incorporate these bonds into your investing strategy.
NEED TO SUMBIT ON THE Turnitin. Will check similarity.
Make sure you did your own work, use your own language to answer all the questions.
Submission will be sent to Turnitin to be electronically reviewed for plagiarism.

Essay Sample Content Preview:

Financial Services & Trading Institutions Problems
Student's Name
Institutional Affiliation
Course Name and Number
Professor's Name
Assignment Due Date
Financial Services & Trading Institutions Problems
Why would you (or your company) invest in a non-investment grade (junk) bond?
My company would invest in a junk bond because a junk bond yields greater returns than investment-grade bonds. Junk bonds are issued on loans that are likely to default. Therefore, the borrower's likelihood of paying back the loan is supposed to bear more significant risk than the loans in investment-grade bonds. Investing involves taking risks—the greater the risk, the greater the reward. Investment-grade bonds do not bear the significant risk. Top agencies, including Standard and Poor's and Moody's, rated investment-grade bonds as AAA or Aaa. However, junk bonds can have a rating of as low as D....
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