In the world of investments there are many different variables to consider, one type of investment many people look into are the best bonds. There are many different bond markets that you could choose to put your money into. As with other forms of investment, bonds come with their own risks and rewards that need to be considered. Read on to learn more about what we feel are the best bonds to invest in.
Some types of bonds are issued by the government in order to raise funds for capital investment projects, such as building new transportation infrastructure, for example. You might choose to look into local government bonds as well as those issued by the national government or even overseas governments.
Issues With Government Bonds
The trouble with many of these types of bond investments is that – although they are often regarded as one of the most stable forms of investment you could make – they often only provide modest returns. As such, some people are put off bonds but that is usually because they have often not explored the corporate bond market to its full extent.
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Who Else Issues Bonds?
These days, many corporations that are seeking credit will issue bonds as a sound means of doing so. The property development sector is a good example because it has been issuing fixed term bonds to investors for years. In emerging markets, too, bonds are sometimes issued to achieve a level of inward investment that an industry might not be able to achieve from traditional sources of credit, such as venture capital or the banks. A good example of this would be the renewable energy sector which has made great strides in recent years thanks to the financing it has derived by issuing bonds to investors.
The Benefits of Corporate Bonds
What makes the corporate bond market stand out from the public sector one is that the return on investment is generally speaking much higher than you could achieve from a government-backed bond scheme. As such the best investment bonds from a financial point of view are often to be found in the private sector.
Ethical Investing | Renewable Energy Bonds
Growing Bond Markets
In fact, many investors choose to put their money into things like renewable energy not simply because they are among the best investment bonds for providing a high yield, but because it allows them to invest in an ethical industry, one that is actively engaged in making the world a greener place and helping to protect the environment.
If you are thinking about where to invest money and the best investment bonds for your personal attitude to risk, then read on to discover some of the key facts about the bond market.
Where to Invest Money?
For many UK residents, the idea in putting their money into a British business which is employing people in the country and itself making an investment in the UK’s economy is an attractive proposition. It is fair to say that you can also make bond investments in overseas markets if you feel that is something that suits you.
US Treasury Bonds
For example, the US Treasury issues bonds to anyone who wishes to pay for them. The difference with a UK bond scheme is that it all the transactions that take place are conducted in sterling so you don’t need to worry about the vagaries of the international currency markets which might eat into your earnings over the course of an overseas bond’s term to maturity.
Wind Energy Bonds by Investor Shield
In addition to the aforementioned reasons for investing in bonds in the home market, UK bonds schemes, like any other well-run financial product in the country, should be regulated properly. This puts many investors’ minds at ease when they are considering the merits of purchasing bonds in their home market.
Largely, the financial products offered to savers in the UK have been pretty uninspiring given the historic low that Bank of England interest rates have sat at for years on end. As such, large numbers of UK investors who have looked for alternative investment models which still mean keeping their money in the country have discovered the merits of the country’s often attractive bond market.
INVESTING IN THE UK’S FUTURE
That said, it is the thought that offering much-needed finance to the UK’s renewable energy sector as well as providing house builders with the capital they need to build new homes that makes many people want to get involved in corporate bonds issued by UK companies.
In a significant number of cases, UK investors say that they have chosen to put money into bonds which will be of benefit to them through the returns they offer but also because of the good their money can do in the wider economy providing the stimulus that is often needed to get new projects going.
INVESTMENT BONDS BY INVESTOR SHIELD
Renewable Energy Bonds
Renewable energy bonds offer just about the most exciting investment opportunity for UK investors today. Among the best investment bonds available from an ethical standpoint, renewable energy bonds are also some of the highest yielding investments around, as well.
They offer renewable energy companies the means by which they can raise the necessary financing they require to grow the sustainable energy sector in the UK as well as affording investors the unrivalled chance to put their money into a technology that helps to safeguard the planet’s future.
Biofuels | Wind Power | The Biofuels Industry
Firstly, the biofuels industry is a key one to look at for anyone seeking the best investment bonds from the perspective of growth potential. Biofuels are likely to be the future of many aspects of energy production in the coming years as sources of oil continue to dwindle or are interrupted by an uncertain and increasingly fractious international scene.
With many, many applications in the transportation sector, biofuels can be grown to run diesel engines but they are also viable as a fuel for jet propulsion aircraft, as well. By harvesting a crop of biofuel and converting it into something usable, it also has an environmental benefit over traditional fossil fuels. This is because the crop can be replanted, thereby removing carbon from the atmosphere in a sustainable, cyclical process.
The biofuels industry is already on its third generation of fuel types and expanding rapidly across the globe. In the UK biofuel operators need financial investments in order to develop their programmes and to build new refining plant. Offering returns on a bi-annual basis and with terms that are as short as one-year ventures into the industry can start at as little as £10,000. A typical three-year term could see you with a very healthy return on your investment of as much as 11 per cent.
Secondly, the wind-based electrical generation sector offers investors a clear-cut opportunity to invest in a sustainable industry that has already established itself as one of the leading players in commercial energy supply. These days, the amount of power that is generated from the UK’s wind farms outstrips any other form of production at certain times.
Both onshore and offshore wind energy companies require inward investment in order to buy the turbines and other infrastructure that is needed to make wind energy a greater part of the UK’s energy mix. For this reason, they offer green energy bonds which can be very tempting to a wide range of investors.
The growing wind energy sector offers bonds which provide yields of as much as 12 percent for something like a three year period of commitment. As one of the UK’s most stable sustainable industries, it is also able to attract investors with both large and small capital sums that they’d like to see invested. As energy prices from fossil fuels continue to rise, so the value of investments in wind-based companies is also only likely to become more and more attractive.