The easy way to invest in fixed income, diversify your portfolio – and improve your yield1.
- A bond is a debt instrument issued usually by a government or a corporation at face value, also known as par value.
- The buyer of the bond is paid interest, the coupon rate, usually semi-annually – this is the buyer's return or yield on the bond.
- Upon maturity, the buyer of the bond is repaid their original investment at face value or par.
Bonds can help you build a balanced portfolio, while generating retirement income and reducing your exposure to volatility.
To help you get more out of your fixed income investing, Scotia iTRADE offers:
Simplified, transparent pricing– $1 a bond ($1 per $1,000 Face Value, $24.99 min/$250 max)1 with no markups or hidden fees. See the difference
- Large inventory of fixed income products, including Canadian and U.S. bonds, corporate bonds, strip bonds, t-bills, high-yield bonds and more
- Competitive bond marketplace comprising different liquidity providers so you can take advantage of truly competitive pricing
An investor purchases $50,000 in Government of Canada bonds that mature in 5 years. The buyer is paid semi-annual interest payments over the course of those 5 years and then redeems the bonds' full-face value of $50,000 when the bonds mature. Coupon payments (or interest payments) vary.
Bonds are also resold at varying prices according to market conditions, between buyers. However, when bonds are purchased between coupon payments, the buyer must pay the seller the Accrued Interest (or accumulated interest) from the last coupon payment until the transaction settlement date. The buyer will then receive a full interest payment at the next coupon date, redeeming the accrued interest they paid at purchase.