A bond that is issued in small denominations, i.e., for a par value less than $1,000, usually $500 to $25. Baby bonds are typically American bonds, designed to suit small investors who don’t have the financial ability to hold large-denomination bonds. Similarly, baby bonds bring the bond market within reach of small companies that lack the financial resources to access institutional markets. However, these bonds are less liquid than ordinary bonds, and hence their secondary market is small and inactive.
March 17, 2025
