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What Is a Trust Indenture in Bond Investing?

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A trust indenture is a legal agreement between a bond issuer and a trustee, such as a bank, that outlines the terms of a bond issue.

It details the issuer’s responsibilities, the rights of the bondholders.

This document helps maintain transparency and protect investors from potential defaults.

Trust indentures are most commonly associated with certain types of bonds.

SmartAsset 's free tool matches you with vetted financial advisors who serve your area.

Understanding the role and provisions of trust indentures can help you assess risks and make informed decisions.

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