The Sterling Bonds and Fixed Income Handbook. Mark Glowrey

the small size of the country and the ambitious activity of its bankers. It is now rated BBB-, the lowest possible investment grade rating.

      Corporate bonds are even more subject to change as their issuers may be impacted by adverse trading conditions. Leveraged takeovers, in particular, can have sudden and disastrous impact on credit ratings.

      Endnote

      2 Note that risk of default should not be confused with market risk, or price volatility. A bond can be 100% guaranteed by all the governments in the world and still experience price swings between issuance and redemption, typically driven by changing interest rates. [return to text]

      PART II: Bond Markets

      This second part of the book explains the different types of bonds available to investors in the market. We will look at the different types of bonds trading in the sterling markets and take a brief glance at some of the overseas currency markets. We start by looking at the UK government bond (or gilt) market, this being the most liquid and transparent of all the sub-sets of sterling bonds and the natural reference point or benchmark for assessment of value in other areas.