Mintos launches high-yield Fractional Bonds for retail investors
Mintos announce the launch of high-yield Fractional Bonds. This offering opens up the world of fixed-income securities to retail investors in Europe, making it accessible and easy for anyone to diversify their portfolio with bonds.
Historically bonds, and especially high-yield bonds, have predominantly been within reach of institutional investors or individuals wielding substantial capital, making them notably less accessible to retail investors. Starting today, Mintos enables individuals to invest in high-yield bonds with as little as €50 and zero commissions, transforming the way people approach investing in debt instruments.
Initially, Mintos will offer investments in high-yield corporate bonds issued by the lending companies present on the Mintos platform. Meanwhile, the company is already working on expanding its offering to encompass bonds of firms in various industries, such as agriculture, manufacturing, and more.
To access high-yield bonds on Mintos, investors invest in Fractional Bonds, asset-backed securities issued by Mintos special purpose entity that fully reflect the economic gains and capital repayments tied to specific underlying bonds. Therefore, through Fractional Bonds, investors enjoy regular, fixed returns from the underlying bond. Each Fractional Bond is associated with a unique International Securities Identification Number (ISIN), ensuring transparency and traceability.
Fractional Bonds make bond investments accessible to retail investors. The vast majority of bonds require high minimum investments of €10 000 or more for a single investment. Moreover, many bonds, especially high-yield ones, aren’t available to retail investors at all.
When you invest in Fractional Bonds on Mintos, you purchase bond-backed securities. This means you won’t hold the underlying bond directly. Instead, you hold Fractional Bonds emitted by a special purpose entity within the Mintos group that acts as the issuer. The Fractional Bonds issuer holds the underlying bond, and passes on its returns to you. Fractional Bonds are only available on Mintos.
The Fractional Bonds issuer receives regular coupon payments and the principal amount of the underlying bond at maturity. These funds will then be forwarded to investors.
If an underlying bond issuer defaults on its obligations, the Fractional Bonds issuer might not receive some or any of the coupon payments or principal. In this event, you may lose some or all of the money you invested in the Fractional Bonds.
The return on a specific Fractional Bonds offer depends on the coupon rate of the underlying bond. The coupon rate is determined by:
- inherent risk factors of the underlying bond, including the bond issuer’s creditworthiness
- market factors, including the general economic environment, general interest rate levels, and alternative investment opportunities in the financial sector
If you hold your Fractional Bonds until maturity, fluctuations in the underlying bond's value will not affect your return. However, if you want to sell your Fractional Bonds on the Secondary Market, the price might be affected by supply and demand, as well as changes in the risk and market factors of the underlying bond. This means the going price on the Secondary Market might be different from the purchase price you paid.
The return on a specific Fractional Bonds offer depends on the coupon rate of the underlying bond. The coupon rate is determined by:
inherent risk factors of the underlying bond, including the bond issuer’s creditworthiness
market factors, including the general economic environment, general interest rate levels, and alternative investment opportunities in the financial sector
If you hold your Fractional Bonds until maturity, fluctuations in the underlying bond's value will not affect your return. However, if you want to sell your Fractional Bonds on the Secondary Market, the price might be affected by supply and demand, as well as changes in the risk and market factors of the underlying bond. This means the going price on the Secondary Market might be different from the purchase price you paid.
There are no fees for investing in Fractional Bonds. You can sell your investments on the Secondary Market on Mintos.