Question-1: What do you mean by Issue in Fixed Income world?

Answer: In the Fixed Income world one of the important things you should be aware is about its issuer. In United states it is possible that both non-U.S. governments and firms can raise capital in U.S. financial markets, and there are three largest issuers of debt which are below

• Domestic corporations
• Municipal governments
• Federal government and its agencies

Each of above issuer, has different features and significant differences.

Question-2: Can you explain the involvement of Domestic Corporation in the Fixed Income Market?

Answer: Domestic corporations, which include regulated/less regulated utilities and manufacturers. Each of this corporation can sell different kinds of bonds as below:

• Publicly placed: Some debt may be publicly placed
• Private placements: whereas other bonds may be sold directly to one or only a few buyers
• Collateralized Debt: some debt is collateralized by specific assets of the company
• Unsecured: Debt without collateral

Question-3: Can you describe something about the Municipal debt?

Answer: Municipal debt is also varying as below

• General obligation bonds (GOs): These are backed by the full faith, credit, and taxing power of the governmental unit issuing them.
• Revenue bonds: These bonds are creditworthiness, which depends on the success of the particular entity for example toll roads, hospitals, or water systems, under the municipal government, which is issuing the bond.

Question-4: How does US Treasury debt differ from above two?

Answer: The U.S. Treasury has the most and biggest one who has much more appetite for debt, but the bond market often receives calls from its agencies. Federal government agencies include federally related institutions and government-sponsored enterprises (GSEs).

Question-5: What is the effect of having different issuers for the bonds?

Answer: It is important for the investor to realize that, by law or practice or both, these different borrowers have developed different ways of raising debt capital. Because of these different issuers, issued debt requirement and bonds have different yield, denomination, safety of principal, maturity, tax status.