Is it a bad thing if a bond is oversubscribed?

0 ⤊

Is it a bad thing if a bond is oversubscribed?

And why/for whom, if you can explain?

2007-01-10 05:23:59 · 2 answers · asked by Goddess of Grammar 7 in Business & Finance ➔ Investing

So it's good for the issuer but not as good for the investors?

2007-01-10 05:34:50 · update #1

2 answers

I think oversubscribed is good, b/c that means that they have sold all they have & there is still a demand! So if they are selling 1million bonds & they have orders in for 1.2 mill., that means they are oversubscribed by 200k. that should raise the price but lower the yield.

2007-01-10 05:31:47 · answer #1 · answered by ricks 5 · 0⤊ 0⤋

No it just means it was popular with investors and if you really want some, you will have to bid for it on the open market.

2007-01-10 13:30:02 · answer #2 · answered by Gary 3 · 0⤊ 0⤋