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BY CLICKING ON “I AGREE”, I DECLARE I AM A WHOLESALE CLIENT AS DEFINED IN THE CORPORATIONS ACT 2001.

What is a Wholesale Client?
A person or entity is a “wholesale client” if they satisfy the requirements of section 761G of the Corporations Act.
This commonly includes a person or entity:

  • who holds an Australian Financial Services License

  • who has or controls at least $10 million (and may include funds held by an associate or under a trust that the person manages)

  • that is a body regulated by APRA other than a trustee of:
    (i) a superannuation fund;
    (ii) an approved deposit fund;
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme.
    within the meaning of the Superannuation Industry (Supervision) Act 1993

  • that is a body registered under the Financial Corporations Act 1974.

  • that is a trustee of:
    (i) a superannuation fund; or
    (ii) an approved deposit fund; or
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme
    within the meaning of the Superannuation Industry (Supervision) Act 1993 and the fund, trust or scheme has net assets of at least $10 million.

  • that is a listed entity or a related body corporate of a listed entity

  • that is an exempt public authority

  • that is a body corporate, or an unincorporated body, that:
    (i) carries on a business of investment in financial products, interests in land or other investments; and
    (ii) for those purposes, invests funds received (directly or indirectly) following an offer or invitation to the public, within the meaning of section 82 of the Corporations Act 2001, the terms of which provided for the funds subscribed to be invested for those purposes.

  • that is a foreign entity which, if established or incorporated in Australia, would be covered by one of the preceding paragraphs.


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Fixed income

Bond rating

A bond rating is a formal assessment of the creditworthiness of a bond issuer or the financial stability of the bond itself. It is typically provided by professional rating agencies such as Moody’s Investors Service, Standard & Poor’s (S&P), and Fitch Ratings.

These ratings serve as an assessment of the issuer's ability to meet its debt obligations. They are crucial for investors to evaluate the risk associated with a particular bond investment.


Key aspects of bond ratings

The key aspects of bond ratings are:

  • Investor information: Bond ratings provide investors with an indication of the likelihood that they will receive the principal and interest payments as promised by the issuer.

  • Market liquidity: High-rated bonds are generally more liquid, as they are considered safer investments.

  • Pricing and yield: Bonds with lower ratings typically offer higher yields to compensate investors for the higher risk of default.


Ratings impact the degree of risk associated with the bond, they range from AAA through to D, where a company is in default, with little prospect for recovery.

glossary-fixed-income-bond-rating-fig1.png

Source: CFI

Bond’s rating upgrades

When a bond’s rating is upgraded, it typically leads to a decrease in yield and an increase in price, reflecting improved creditworthiness. Bond ratings are a vital tool in the fixed income market, providing transparency and helping investors understand the risk associated with bond investments.


Also read:

Investment grade bonds
Bond yield
Bond duration


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Robeco

Robeco aims to enable its clients to achieve their financial and sustainability goals by providing superior investment returns and solutions.

Important information: This website is prepared and issued in Australia by Robeco Hong Kong Limited (ARBN 156 512 659) (‘Robeco’) which is exempt from the requirement to hold an Australian financial services licence under the Corporations Act 2001 (Cth) pursuant to ASIC Class Order 03/1103. Robeco is regulated by the Securities and Futures Commission under the laws of Hong Kong and those laws may differ from Australian laws. The information on this web page is provided to you because Robeco reasonably believes that you are a "wholesale client" within the meaning of that term under section 761G(4) of the Corporations Act 2001 (Cth) ("Corporations Act") and not any other class of persons. This information is not an advertisement and is not intended to induce retail clients to acquire Robeco products. Retail clients who are interested in Robeco products should contact their financial adviser.