What is Fixed Income?
Fixed Income investments are those that pay a regular income at a fixed point during the lifetime of the investment, or until maturity. Income can be distributed to investors as interest or as a dividend, although usually the former. Once the investment matures, the investor will have their initial (or principle) investment returned to them.
The most common examples of Fixed Income investments are corporate or government bonds (or gilts). Corporate bonds are products that are offered by companies as a form of raising capital, and government bonds are issued by governments around the world.
Who can buy a bond?
Any investor can buy bonds through a broker or directly through the government’s HM Debt Management Office (DMO). For individual investors, bonds are often purchased indirectly via Exchange Traded Funds (ETFs) or funds.
