The savings platform Trade Republic has announced a new expansion of its investment offering, allowing you to invest in the investment market bonds. Now, Trade Republic customers will have the option to invest in as many as 500 highly liquid government and corporate bonds on a daily basis.
Trade Republic, investments in bonds are arriving
Christian Hecker, co-founder of Trade Republic, enthused: “Especially in the current environment, bonds are an important asset class to benefit from high interest rates over the long term. We are the first broker in Europe to open this asset class to retail investors. Until now, investors were forced to rely on banks or expensive consultants to access the bond market. With this new offer, we take another step forward make the capital market accessible to an increasingly wider audience.”
This move by Trade Republic solves two fundamental problems in the bond market. First, bonds usually require a considerable minimum investment, often in the order of 1,000 euros. Additionally, the bond market is known for its fragmentation, which makes it difficult find liquid and accessible tools.
Trade Republic has overcome both of these challenges. It thus paves the way for daily trading of ben 500 liquid government and corporate bonds, allowing investors to participate with an investment minimum of just 1 euro. Furthermore, the platform does not apply percentage commissions on transactionsrequiring only a fixed fee of 1 euro for the settlement of external costs.
This initiative by Trade Republic aligns perfectly with yours mission to democratize financial markets. Bonds have become attractive again for retail investors, also thanks to the favorable taxation of government bonds.
Emanuele Agueci, Regional Manager for Italy, Ireland and the Baltics of Trade Republic, commented: “Bonds have always been a cornerstone of the Italian retail investor. It is estimated that in our country the number of retail bondholders is more than double that of shareholders. However, in recent years there has been little talk about bonds because, simply, returns have not been attractive in the recent past. Today this is no longer the case: with ECB reference rates above 4%bonds have once again become an attractive diversification tool for retail investors.”
Additionally, starting October 1, 2023, Trade Republic will pass on 4% annual interest on uninvested cash from banking partners to its customers. Find more information here.