Question

In Australia, the Federal and State governments can raise funds by issuing bonds. Please list the...

In Australia, the Federal and State governments can raise funds by issuing bonds. Please list the major investors in these bonds and why they invest these bond.

Homework Answers

Answer #1

A Australian government bond or sovereign bond can be issued by government to pay a periodic interest payments in form of coupon rate and  repayment of the face value of the bond at end of the bond term. The measure purpose of these bonds are to support spending and planned capital expenditure.

List of investors in such bonds are:

  • Banks
  • Financial Institutions
  • Mutual fund house
  • ETF
  • retail investor by indirect method

Benefits of Buying such bonds:

  • Low risk - Low chance of default by government
  • Regular and continuous income - interest paid on either quarterly or half-yearly basis
  • Easy to buy and sell - buy and sell anytime the Australian stock exchange
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Concurrent Powers of government - list 5-7 powers shared by state and federal governments Divided Powers...
Concurrent Powers of government - list 5-7 powers shared by state and federal governments Divided Powers of government - list 5-7 powers held separately by the state and federal governments.
With celebrity bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of...
With celebrity bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of the music are used to pay interest and principal on the bonds. In April of 2009, EMI announced that it inherited to securitize its back catalogue with the help of the Bank of Scotland. The bond was issued with a coupon rate of 6.85% and will mature on this day 40 years from now. The yield on the bond issue is currently 6.15%. At...
With celebrity​ bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of...
With celebrity​ bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of the music are used to pay interest and principal on the bonds. In April of​ 2009, EMI announced that it intended to securitize its back catalogue with the help of the Bank of Scotland. The bond was issued with a coupon rate of 6.75% and will mature on this day 21 years from now. The yield on the bond issue is currently 6.3%. At...
With celebrity​ bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of...
With celebrity​ bonds, celebrities raise money by issuing bonds to investors. The royalties from sales of the music are used to pay interest and principal on the bonds. In April of​ 2009, EMI announced that it intended to securitize its back catalogue with the help of the Bank of Scotland. The bond was issued with a coupon rate of 6.5% and will mature on this day 37 years from now. The yield on the bond issue is currently 6.4%. At...
A company wants to raise $600,000 by issuing zero coupon bonds. The bonds have a face...
A company wants to raise $600,000 by issuing zero coupon bonds. The bonds have a face value of $1,000 and will mature in 8 years. The issue price gives potential investors a yield to maturity of 3% p.a. (nominal). Assume comparable-risk coupon bonds normally pay semi-annual coupons Calculate the issue price per bond. (Round your answer to 2 decimal places. Do not include the $ symbol. Do not use comma separators. E.g. 1234.56) Answer    How many bonds should the...
29. One of the key differences between a corporation choosing to raise additional funds through issuing...
29. One of the key differences between a corporation choosing to raise additional funds through issuing stocks rather than bonds is: Multiple Choice The purchaser of a bonds generally has the right to vote in elections for the board of directors and on proposed operational alterations but stockholders have no voting rights. There is a legal requirement for corporations to pay dividends but they can choose to pay coupons and the par value on bonds. The value of a stock...
The Oriels are deciding whether to raise $600 million by issuing a bond, or by borrowing...
The Oriels are deciding whether to raise $600 million by issuing a bond, or by borrowing the cash from a bank, to build a new stadium. The organization can offer a 7% coupon rate on a standard, 25-year bond, or the bank will lend the Oriels the funds at a 4.1% for 35 years. Which option should the Oriels choose and why? What would be the difference in total funds paid back to either the bond hold or the bank?
Kintel, Inc., management wants to raise $1 million by issuing six-year zero coupon bonds with a...
Kintel, Inc., management wants to raise $1 million by issuing six-year zero coupon bonds with a face value of $1,000. The company’s investment banker states that investors would use an 10.32 percent discount rate to value such bonds. Assume semiannual coupon payments. At what price would these bonds sell in the marketplace? (Round intermediate calculations to 4 decimal places, e.g. 1.2514 and Bond price to 2 decimal places, e.g. 15.25) Market rate $ How many bonds would the firm have...
Ms. Z has decided to invest $75,000 in state bonds. She could invest in State A...
Ms. Z has decided to invest $75,000 in state bonds. She could invest in State A bonds paying 5 percent annual interest or in State R bonds paying 5.4 percent annual interest. The bonds have the same risk, and the interest from both is exempt from federal income tax. Because Ms. Z is a resident of State A, she wouldn’t pay State A’s 8.5 percent personal income tax on the State A bond interest, but she would pay this tax...
Please paraphrase Continued collaboration with state and federal governments will further improve incentives for cleaning up...
Please paraphrase Continued collaboration with state and federal governments will further improve incentives for cleaning up and redeveloping brownfields, making them more competitive with uncontami- nated land. At the state level, we will advocate for a full liability release for parties who remedi- ate sites under the NYC BCP. We will work to reach an agreement with the EPA that provides federal liability protection for parties who remediate sites under the NYC BCP. Finally, to accelerate cleanup at sites where...