Secured bonds are bonds that
A) are in the possession of a bank.
B) are registered in the name of the owner.
C) have specific assets of the issuer pledged as collateral.
D) have detachable interest coupons.

Question

Quizplus · Accepted Answer

Secured bonds have specific assets of the issuer pledged as collateral, which provide additional security to investors in case the issuer defaults on the bond payments. Choice A is incorrect as the possession of the bond does not necessarily ensure security. Choice B is incorrect as registration does not provide additional security. Choice D is incorrect as detachable interest coupons are common for both secured and unsecured bonds.

Secured Bonds Are Bonds That