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Why do investors buy debenture?

Updated: 9/26/2023
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Q: Why do investors buy debenture?
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Related questions

What is the meaning and definition of redemption of debenture?

Redemption of Debenture was enacted into Indian law in 2000. It states that any Indian company with a debenture trust must also have a plan in place for its investors, in case of the company's failure.


What are the disadvantages of debenture capital?

High Denominations People can Buy the Debenture Certificate and can not buy other people.


Why maturing debenture may cause problems for the company?

Ideally speaking it is not a problem for the company. All they have to do is, to pay back the investors who bought the Debentures at the time of issue. It can be a problem if the company does not have enough finances to pay off the investors whose Debentures are maturing.


What is a debenture certificate?

it is a document that serve as evidence of a debenture for a debenture share holder


What is debenture certificate?

it is a document that serve as evidence of a debenture for a debenture share holder


What are the reasons for the creation of debenture redemption reserve fund?

Indian Companies Act of 1956 added during an amendment in the year 2000. It states Indian company that issues debentures must offer debenture redemption service to protect investors against the possibility of company default. If a company does not create a reserve within 12 months of issuing the debentures, they will be required to pay 2 percent interest in penalty to the debenture holders. Only debentures that were issued after the amendment in 2000 are subject to the debenture redemption service.


Solve questions of debenture in advance accounting?

what is debenture


Is debenture a current asset?

No. Debenture is a form of liability for a business.


In which case do investors buy stock in expectations of higher profits?

In a bull market, investors buy stock in expectation of higher profits.


What is redemption of debentures using purchase of own debenture?

A company can buy its own debenture in the open market, if it is authorised by its AOA. the debentures so purchased can be used either for immediate cancellation or redemption of debenture or for investment. the debenture so purchase for investment can be subsequently either be issued to fullfill additional requirements of cash or can be cancelled if the company so desires. debentures when purchases for investment are popularly known as 'OWN DEBENTURES.'


How does a term loan differ from a non invertible debenture?

Noninvertible debenture


Is debenture holder a customer of the company?

NO,debenture holder is the creditor of the company