What is the concept of corporate bonds?

Corporate bonds refer to the securities issued by the company in accordance with legal procedures and agreed to repay the principal and interest within a certain period of time. Corporate bonds are debt certificates issued by companies to bondholders and are one of the common ways for enterprises to raise funds. The main characteristics of corporate creditor's rights are: (1) high risk. Because the repayment source of corporate bonds is the company's operating profit, and the company's operation is risky, the creditor of the company bears the risk of losing interest or even principal. (2) The rate of return is high. Higher risk corporate creditor's rights will also provide bondholders with higher investment income. (3) For some bonds, the issuer and the holder can give each other certain options. There are mainly the following types of corporate bonds: (1) According to whether the bonds are registered, they can be divided into registered bonds (the name of the holder is registered on the front of the bonds) and registered bonds (the name of the holder is not required to be registered on the front of the bonds). (2) According to whether the holder participates in the company's profit distribution, it can be divided into participatory corporate bonds (corporate bonds that can get interest income in advance, but also participate in the company's profit distribution to a certain extent) and non-participatory corporate bonds (corporate bonds that can only get interest at the pre-agreed interest rate). (3) According to whether it can be redeemed in advance, it can be divided into corporate bonds that can be redeemed in advance (the issuing company repurchases all or part of its bonds before the maturity of the bonds) and corporate bonds that cannot be redeemed in advance (corporate bonds that can only repay the principal and interest in one lump sum). (4) According to whether the issuer gives the holder the option, it can be divided into corporate bonds with option (in some corporate bonds, the issuer gives the holder a certain option, such as convertible corporate bonds) and corporate bonds without option. Article 153 of the Company Law The term "corporate bonds" as mentioned in this Law refers to securities issued by a company in accordance with legal procedures and agreed to repay the principal and interest within a certain period of time. The issuance of corporate bonds by a company shall conform to the issuance conditions stipulated in the Securities Law of People's Republic of China (PRC).