What is a bond?

A bond is a simple debt instrument. By investing in a bond, you are lending the bond issuer money in return for a fixed rate of interest paid over a specified period of time (known as the term).

As the holder of a bond, you would expect to receive interest payments at regular intervals and at the end of the term expect your initial investment (known as your invested principal) to be repaid.

For example, if you invested £1,000 in a successful five-year bond with an interest rate of 8% per annum, you would receive £80 of interest each year for the next five years (before any applicable tax). At the end of the five-year term, you would receive your final year’s interest payment together with a repayment of your£1,000 of principal.

Generally speaking, investing in bonds through the Tifosy Investment Platform is about investing in a professional sports club that you think has the potential to make the annual interest payments and repay the principal amount at the end of the term. However, if the business fails in its obligations – as some businesses do – you may lose some or all of your investment.

Each investment will have its own return, terms and risks to consider and the offer document made available as part of each investment opportunity will contain all of the information relevant to the bonds including information about the bond issuer,  its recent trading performance and any material risks. Any decision to invest should be made solely on the basis of a careful review of the offer document. 

For additional information on the risks of investing please read our Risk Warnings.