Shogun Bonds (Geisha Bonds) Definition

Forex Glossary


The term shogun bond identifies a indenture issued in Japan, at a non-yen denomination, with way of a foreign bank or business. Shogun bonds are among many manners for multi national organizations operating in Japan to improve funding.


Foreign corporations who desire to raise funding in Japan have the option of issuing what are called shogun bonds. Also called geisha bonds, those securities is bought by non-domestic entities, including corporations, financial institutions and authorities, and so are issued at a currency aside from the Japanese yen. Exotic bonds, alternatively, is bought by non-domestic entities, and so are issued from the Japanese yen.

Shogun bonds are all attractive to Japanese investors thinking about holding debt that’s issued at a non-domestic money back. But, if a trader buys a security that’s issued in a foreign currency, they have been carrying in a market rate risk.

The shoguns had been military dictators from Japan from the 12th through the 19th century. In that time period, they ruled that the nation during military means.

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