A Dim Sum bond is a bond issued in the Chinese yuan by a non-Chinese company. The name "Dim Sum" comes from the Cantonese word for "touch heart," which describes the small, bite-sized servings of food that are traditionally served at Chinese teahouses. These bonds are usually issued in Hong Kong and are used to finance projects in mainland China.
What is the utility of masala bonds? Masala bonds are utility bonds that are issued by Indian companies in foreign currency. The name "masala" comes from the fact that these bonds are typically issued in rupees, which are then exchanged for foreign currency. The purpose of these bonds is to raise capital for Indian companies without having to go through the process of issuing new equity. Instead, these bonds are issued as debt, which can be more easily converted into cash than equity.
There are several benefits to issuing masala bonds. First, it allows Indian companies to tap into new sources of capital. By issuing bonds in foreign currency, Indian companies can access a larger pool of investors, including those who may be otherwise reluctant to invest in Indian companies. Second, it can help Indian companies to hedge their currency risk. By issuing bonds in foreign currency, Indian companies can protect themselves from fluctuations in the value of the rupee. Finally, it can help Indian companies to raise capital at a lower cost. Because masala bonds are typically issued with a higher interest rate than traditional bonds, they can help Indian companies to save money on their borrowing costs. What is a kangaroo bond? A kangaroo bond is a bond that is issued by an Australian entity in another country's currency. For example, a kangaroo bond might be issued by an Australian bank in US dollars. The name "kangaroo bond" comes from the fact that Australia is sometimes referred to as the "land down under", and the kangaroo is a well-known Australian animal.
Kangaroo bonds are typically issued by banks, corporations, and governments. They are often used to raise capital for investment in Australia, or to fund Australian operations of international entities.
Kangaroo bonds typically have maturities of five years or more. They typically offer higher yields than comparable bonds issued in the domestic market, because they are considered to be higher risk. However, kangaroo bonds are often less risky than other emerging market bonds.
Kangaroo bonds are subject to Australian taxation rules. This can be an advantage for foreign investors, because they may be able to claim a tax exemption on the interest income.
Kangaroo bonds can be traded on the Australian Securities Exchange (ASX), or over the counter (OTC). Can foreign investors buy Chinese bonds? Yes, foreign investors can buy Chinese bonds. China has been gradually opening up its bond market to foreign investors since the early 2000s, and the process has accelerated in recent years. In 2020, China's bond market was the third largest in the world, with a total value of approximately $16 trillion. There are a number of ways for foreign investors to access the Chinese bond market, including through investment vehicles such as exchange-traded funds (ETFs) and mutual funds, as well as directly through brokerages. What is RMB bond? The Renminbi (RMB) bond is a type of Chinese government bond denominated in the Chinese currency, the Renminbi (RMB). RMB bonds are issued by the Chinese government and are traded on the Shanghai Stock Exchange.
RMB bonds offer investors a safe investment with a high yield. RMB bonds are also a good way to hedge against inflation.
What is the difference between CNH and CNY?
CNH is the international designation for the Chinese yuan, and is typically used when referring to yuan-denominated assets outside of China. CNY is the designation for yuan-denominated assets within China. The two are interchangeable, and there is no difference in value.