Corporate Bonds
- What it is: Loans to private companies or state corporations
- Risk level: Low to moderate (depends on the company’s financial strength)
- Typical return: 12-18% annually
- Key consideration: Higher returns than government bonds but with higher risk
- Real example: KSh 10,000 in a Safaricom bond at 15% = KSh 1,500 in interest per year
- Where to get it: Through licensed stockbrokers on the Nairobi Securities Exchange (NSE)
- Minimum to start: Often KSh 100,000, but bond funds let you start with less
- Important note: Always check the company’s credit rating before investing