Dubai: Emirates NBD has introduced the provision of fractional bonds for individual investors. The product allows investors to gain access to international bond markets with a minimum investment as low as $25,000, making it among the first banks in the region providing such a service.
The international bond market generally holds a minimum investment of $200,000 for Fixed Income bond securities, often making entry difficult for retail investors. The introduction of fractional bonds will benefit investors looking to access a new asset class with smaller investment amounts, allowing them to broaden their investment horizons and benefit from alternate income source.
“Fractional bonds offer investors several advantages, including opportunities for diversification, allowing them to spread their risk across various bond issuers, sectors and maturity periods, thus helping to enhance the stability and resilience of their investment portfolios,” the banks said.
Through fractional bonds, individual investors according to their classification, can build customised bond portfolios that align with their investment goals and select bonds based on their risk appetite, desired yields, credit ratings and other criteria, tailoring their portfolios to meet their unique needs. Further, fractional bond investors can liquidate their bond investments by selling their holding back through Emirates NBD, ensuring they have the ability to access funds when required.
“As a leading banking group in the UAE we strive to introduce first-to-market products which enhance the financial prosperity of our customers,” said Marwan Hadi, Group Head, Retail Banking and Wealth Management at Emirates NBD. “Complementing our existing strong wealth management offering, we are pleased to be one of the first banks in the region to introduce fractional bonds, which will benefit retail investors looking to grow and diversify their portfolios by overcoming the challenge of the high barrier to entry.”
