The protection of bond collateral

Question

Quizplus · Accepted Answer

The protection of bond collateral is crucial to increasing the safety of the bond issue, as it provides security to investors in case of default. Additionally, it helps enhance the marketability of the bond issue as investors are more likely to invest in a bond where their investment is protected. Therefore, both options (a) and (b) are correct. Option (c), which implies that the protection of bond collateral does not usually occur, is incorrect as most bond issues do include provisions for protecting bond collateral.

The Protection of Bond Collateral