Question

Subordinated debentures Group of answer choices are the safest form of corporate bonds. are financial assets held in trust by a third party. have a lower claim on assets than simple debentures. are secured by some physical asset.

Answer 1

have a lower claim on assets than simple debentures

Step-by-step explanation:

Subordinated debenture have a lower claim on asset than simple debentures.

They are a form of debt or loan without any security and occupy the bottom in the scale of debt repayment.

Subordinated debentures represent an investment with higher risk due to lack of security or backing collateral, but as expected, they come with higher returns when compared to their unsubordinated counterparts.