What is a Bondholder?
A bondholder is generally defined as an individual or entity that is the bearer of a currently outstanding and active bond. The bond that is held by the bondholder may be registered directly to the bearer, or may be an unregistered bond in some cases. As the controller and owner of a bond, the bond holder has full authority to manage the bond in any way that he or she sees fit. There are several advantages to being a bondholder, rather than holding stock in a company. One of the more prominent advantages is evident when the company goes through a process that involves the liquidation of assets. Bondholders are given precedence over stockholders, which means that the bondholders will receive compensation for the outstanding bonds before any of the stockholders receive returns from their outstanding shares of stock. However, the bondholder also benefits in other ways as well. One of the receipt of regular interest payments during the life of the bond. Generally, the exact frequency and r
