Investment VehiclesCâu 94 / 100
High-yield (junk) bonds are characterized by:
a.Investment-grade ratings and low default risk
b.Government backing
c.Lower credit ratings, higher yields, and greater default risk
d.Guaranteed principal repayment
Giải thích
High-yield bonds carry below-investment-grade ratings and compensate investors with higher yields to offset elevated default risk. They are more sensitive to economic downturns and issuer credit deterioration. Suitability requires a client who can tolerate this credit risk.
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Câu hỏi liên quan cùng chủ đề
- A convertible bond gives the holder:
- An investor writes a covered call. This strategy:
- A unit investment trust (UIT):
- Compared with corporate bonds, municipal bonds of similar credit quality typically offer:
- An equity-indexed (fixed-indexed) annuity typically credits interest based on:
- A money market fund seeks to:
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