After interviewing multiple players and reviewing a lot of numbers, I'm seeing a few distinct bond strategies that are worth sharing with others as they consider their long-term investments. I hope this helps.
You can also read a more basic bonds guide which discusses basic bonds principles in Sim Companies.
Any level player can be seeking extra capital for upgrades.
PRO: Offering low interest rates can mean your upgrades will make more than you pay in interest, usually by a great deal.
CON: You can only offer bonds up to your building asset value. At that point, you are over-leveraged. You are under no obligation to call those bonds, but if you have offered them high, the debt payments may become an issue.
Any player can buy other players' bonds that are higher in percentage than they have sold at.
PRO: Your excess capital will return interest every night without any inputs as long as the company you invested in is solvent.
CON: You have no way of getting that cash back without begging the player to call the bond. That is just bad etiquette, in my opinion. Also, defaults happen.
Any player can both buy and sell bonds.
PRO: If you take in capital by offering bonds at 0.5%, then buy bonds at 0.6%, more interest comes in that is going out each night. Easy money with no effort at all.
CON: When someone calls your bonds, it can upset the balance.
Deciding which strategy to pursue depends both on the player's debt tolerance and the ratio of cash flow to asset value. Let me give some examples:
A) Low-level player, just starting out - With no real asset value, not many bonds can be issued initially. However, as you use those to upgrade, you can issue more. The key is to make sure you continue to have cash flow for nightly debt payments and production.
B) Mid-level player, decently established - Around 500k asset value, you can begin taking on real debt. As long as you can cover the interest, keeping cash on hand for production can be more valuable than calling those bonds.
C) High-level player, well-established long-term player, good cash flow - Being able to get investors from higher ranks and then buying riskier bonds from the lower ranks at higher percentages can be a profit center. Managing investments becomes a matter of when to call bonds and when to buy bonds.
D) Top 10, lots of cash, lots of needs - Issuing bonds as a means of raising massive capital is possible when asset values are in the several millions. However, dumping cash into bonds can be as meaningful once/if interest rates ever exceed about 3%.
Monkey
CEO "Simia"
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