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Types of fixed income products
Sovereign bonds (Public Debt)

In Europe, sovereign bonds are Public Debt issued by sovereign states or public treasuries. In the UK these are known as "gilts"; in France, "OATs"; in Germany "Bunds"; and in Italy, "BTPs" (as well as various other names). In the US, they are "US Treasuries" or "T-Bills".

Corporate bonds

Corporate bonds (corporate debt or private Fixed Income) are the second most important bonds after government bonds and comprise around 30% of the global fixed income market. Retail investor appetite is greater for these types of bonds in the US than in Europe.

The high yield corporate bond market.

These high yield bonds are also known as “speculative” or “junk” bonds given their low credit rating.

Guaranteed debt

This kind of debt has risen in popularity in recent years as it offers higher guarantees in the event of default. The guarantee or security can come from a number of sources: mortgages, loans or other assets. These are more sophisticated and complex than plain vanilla bonds and investors need to understand them well before investing. These kinds of bonds have been hard hit during the recent financial crisis. They can include securitised bonds or cédulas hipotecarias (covered bonds). Given the higher level of guarantee, these instruments enjoy a high credit rating.



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