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• CONDITIONS

  ✓ refers to the global and domestic macroeconomic conditions.
• CAPACITY

  ✓ this is establishing the income and debts that the borrower has.
• An innovation was introduced when treasury bonds of smaller denominations were issued in as Iow as amount as Php 5, 000 to finance various projects of the government.
• Bonds issued by the Bureau of the Treasury are called T-bonds.
• CORPORATE BOND

  • is issued by private corporations with very strong credit ratings which needs a significant amount of cash.
• Mortgage bond - secured by a lien on specifically named property such as land, buildings, and other fixed assets
• CALLABLE/ REDEEMABLE BONDS

  • can be called, redeemed or retired by the issuing company before maturity date.
• NON-CALLABLE/ NON-REDEEMABLE BONDS

  • are not subject to calls or redemption before maturity date.
• PERPETUAL BONDS

  • are those for which the holder cannot redeem payment.
• SIMPLE INTEREST

  • calculated based on flat percentage rate of the principal and remain constant for the duration of the investment.
• COMPOUND INTEREST

  • interest added to the principal of a deposit or loan so that the added interest also earns interest then on.
• MARKET RISK

  • affects the prices of securities due to the rise or fall of the market during a bull or a bear market, respectively.
• SYSTEMATIC RISK

  market risk or undiversifiable risk

  • it is the fluctuations in the returns on securities that occur due to macroeconomic factors
• UNSYSTEMATIC RISK

  diversifiable risk, residual risk, or company-specific risk

  • these risk factors exist within the company and can be avoided and can be reduced through diversification.
• MANAGEMENT RISK

  happens when the decisions made by a firm’s management and board of directors materially affect its business models or the risk faced by its investors.
• INTEREST RATE RISK

  • it is the fluctuations in the value of an asset as the level of interest rates change.
• • Bull Market happens when share prices and market goes up.

  • Bear Market happens when share prices and market is not doing

  well.
• MANAGEMENT RISK

  • happens when the decisions made by a firm’s management and board of directors materially affect its business models or the risk faced by its investors.
• FINANCIAL RISK

  • is the inability of the firm to not being able to pay off the debt it has taken from the bank or a financial institution.
• BUSINESS RISK

  • is the uncertainty about the rate of return caused by the nature of the business.
• LIQUIDITY RISK

  • exists when an asset is not readily marketable or simply, w
• POLITICAL RISK

  • arises from new tax laws, changes in the government, lack of consistency in government policies and corruption among others.
• DIVERSIFICATION

  • is a risk-management technique that mixes a wide variety of investments within a portfolio to minimize the impact that any one security will have on the overall performance of the portfolio.
• INVESTMENT

  • the act of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit.
• RISK-RETURN TRADEOFF

  • is the concept that explains that there is a commensurate return for every risk a business owner or investor takes and that the return expected is usually greater for more risk taken.
• INCOME

  • more incomes and more avenues of investment have led to the ability and willingness of working people to save and invest their funds.
• INCREASING RATES OF TAXATION

  • when tax rate is increased, it will focus for generating saving by the tax payer
• LIFE EXPECTANCY

  • people saving by themselves does not increase wealth; so prior to retirement, saving must be invested in such a way that the principal and income will be adequate for a greater number or retirement years.
• INVESTMENT CHANNELS

  • the growth and development of the country leading to greater economic prosperity has led to the introduction of vast areas of investment outlets.