RT Journal Article
SR Electronic
T1 Collateralization of Bond Interest
JF The Journal of Investing
FD Institutional Investor Journals
SP 32
OP 34
DO 10.3905/joi.2005.605279
VO 14
IS 4
A1 Harold Bierman, Jr
YR 2005
UL https://pm-research.com/content/14/4/32.abstract
AB Collateralization of bond interest is a new development in corporate finance. If the investor accepts a lower interest, then it is possible for the borrower to have a lower borrowing cost. This article shows that there is no reason to think the borrowing cost is lowered if the funds used to collateralize the interest are borrowed.