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Disclaimer
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 1993that 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.
Fixed income
Interest rate risk
Interest rate risk refers to the potential for investment losses due to changes in interest rates. It primarily affects fixed-income investments, like bonds, as bond prices and interest rates have an inverse relationship: when interest rates rise, bond prices tend to fall, and vice versa.
This risk impacts the value of existing bonds because newer bonds might be issued with higher yields, making older, lower-yielding bonds less attractive to investors, which can lead to a decrease in their market value.
Impacts borrowers and lenders
Interest rate risk also affects borrowers and lenders, as changing rates can increase the cost of borrowing or reduce investment returns. Investors manage this risk through strategies like adjusting bond maturities, using hedging techniques, or diversifying their portfolio. In general, longer-term bonds are more sensitive to interest rate changes than shorter-term bonds, making them riskier in a fluctuating interest rate environment.
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