HGK Prepared an Educational Brochure on National Bonds

Continuing its activities in the area of raising financial knowledge and financial literacy in society, the Croatian Chamber of Economy has prepared a new educational brochure titled ‘What are Bonds and What is Important to Know About Them’, aimed at familiarizing citizens with the concept of bonds as one form of investment.

– Bonds are debt securities, or a type of loan, whereby investors in bonds lend funds to the issuer (state, local government unit, or company) for a specified period. The issuer of bonds pays investors interest (coupon) at predetermined intervals, most often annually or semi-annually, and returns the principal on the maturity date – as stated on their official website.

Investing in bonds, due to the repayment of the invested amount at maturity, is considered a more conservative form of investment, but they are not savings or deposits and are not covered by the deposit insurance system.

Minimum investment of 500 euros

The maturity of bonds is one of the important elements that investors must pay attention to when making their investment decisions. Namely, in the case of selling a bond before maturity, for example, if an investor urgently needs the invested funds, there is a risk that they will not receive the entire invested amount since the selling price depends on market conditions at the time of sale (e.g., it may be lower than the price at which the bond was purchased).

Additionally, it should be noted that each transaction conducted on the secondary market incurs additional costs such as brokerage fees.

Croatian citizens will be able to subscribe to government bonds for the first time starting Wednesday, with a minimum investment of 500 euros. The first round will be open to citizens from February 22 to March 1, 2023, and in the second round on March 3, 2023, subscriptions will open for institutional investors and will last for one day. The maturity period of the bonds is two years, and the government plans to raise one billion euros through this issuance.

HGK will traditionally participate in Money Week this year, which is celebrated from March 20 to March 26, 2023, under the title ‘Plan Your Money, Plant Your Future’. Through various educational and informational activities for high school students, their teachers, and students in Zagreb and other cities, we aim to contribute to raising financial literacy among young people, which is important for their better preparedness for the labor market and the demands they will face as future entrepreneurs – as stated on their website.