Investment in fixed interest products can be made in either the primary (new issues) or secondary market. The primary market is where a borrower first issues a security. The secondary market is where existing fixed interest securities are traded.

Commonwealth Government Bonds
Bonds issued and guaranteed by the Commonwealth Government. These bonds are often referred to as “risk free” investments and have a “AAA” credit rating. Interest is normally paid half yearly.

Semi-Government Bonds
Bonds issued and guaranteed by the various States of Australia. Interest is normally paid half yearly.

Corporate Bonds/Debentures
Corporate Bonds or Debentures are typically issued by large corporations or finance companies and can be for terms out to ten years. Most Corporate Bonds are fixed rate – where the coupon is fixed for the term of the investment – but some are floating rate – where the coupon is reset periodically over a nominated bank bill rate. Interest can be annual, half yearly, quarterly, monthly or compounding. Debenture investments start from as little as $3,000, whereas most Corporate Bond investments start from $500,000.

Bank Bonds
Bank Bonds are transferable deposits issued and guaranteed by banks and have many of the same features as Corporate Bonds, however these investments start from as little as $5,000.

Term
Deposits with banks or other financial institutions (such as Credit Co-op's or Building Societies) that are set for fixed terms, from 1 month to 5 years, and that are guaranteed by the particular institution. Term Deposits are normally not transferable.