Why do some companies frequently issue bonds?

Peer Power offers a type of bond known as a "Trade Financing Bond," which is a short-term bond with a maturity period of no more than 3 months. This bond is designed to help businesses increase their working capital. Instead of taking out large long-term loans, businesses can issue short-term bonds more frequently. This type of financing is particularly suitable for trading businesses or manufacturers whose order volumes may fluctuate, making it difficult to manage cash flow. Such businesses typically require substantial working capital but can often repay the debt within a few months after collecting payments from their customers.

One of the advantages of short-term Trade Financing Bonds for investors is that they provide greater confidence in the borrower's ability to repay the debt. The loan amount is based on the orders the business has received, and the loan term matches the actual cash flow needs. If the business fails to repay the debt on time, it will affect the issuance of future bonds, thereby reducing risk for investors compared to investing in long-term, high-value bonds all at once.

Additionally, Peer Power regularly reviews the financial performance of businesses issuing Trade Financing Bonds on a monthly basis to further ensure their repayment capability.

Therefore, investor may notice that some companies frequently issue “Trade Financing Bonds,” . However, investors should still read the prospectus of each bond to understand the details before investing.

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