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- All about bonds (home)
Resource website on all about bonds, including all about i bonds, bond investing, and other fixed income investments. All about bonds offer great and free advice on bond investing and all about i bonds investing.
- All About Bonds
On this website you will learn all about bonds. Bond investing or fixed income in vesting is much safe than stock or mutual fund investing.
- What is a Bond
Before we discuss bond investing, we need to answer the question 'what is a bond'. In later sections, we will answer 'what is a savings bond' and 'what is bond market'?
- What is a bond?
Bonds are used as a “core” investment to build the foundation of a balanced portfolio. This is because they offer a wide range of maturities, interest payment terms and credit quality ratings selected to fit most portfolio needs.
- Bonds Features
To complete a basic understanding of bonds, you should know about some other features of these securities.
- Types of Bonds
There are many types of bonds. Within each type of bonds, there are also sub types of bonds. There are different types of corporate bonds, for example, as there are different types of savings bonds and different types of government bonds.
- Bond Maturity
A bond 's maturity is the date at which the bond repays the principal and any remaining interests in full. Bond mutual funds and bonds can be classified according to the bond maturity date.
- Bond Investing
Bond investing has been known to be one of the safest kind of investing. Investors investing in bonds often look for the safety and low risk factor rather than high return, seen in stock investing.
- Zero Coupon Bonds
Zero coupon bonds or just zeros are unlike most bonds that pay interests during the life of the bonds. Zero coupon bonds do not pay interests, hence the name zero coupon bonds.
- Investments Zero Coupon Bond
Investments in a zero coupon bond may not be as good as financial planners make it out to be. Zero coupon bonds are claimed to be safe investments.
- Why have Bonds in Portfolios
For many, the bull market of the 1990s brought about the demise of asset allocation. Many investors flocking to reap historic stock market returns lacked diversification in their portfolios as well as in their stock holdings, placing all their eggs in the high-flying, high-tech basket.
- Three Bond Investing Concepts
Before you learn about the different types of bonds, you should understand these three general bond investing concepts.
- The Ladder Portfolio Strategy
The ladder portfolio strategy is a good way to invest in bonds and fixed income investments. The ladder portfolio strategy plays an important part in bond investing. Below is an illustration of how the ladder portfolio strategy works.
- Bond Swapping
Bond Swapping is a very handy bond investing technique. One of the key reasons why investors may want to swap bonds is to generate current tax losses. But, there are many things to consider in bond swapping.
- Treasury Securities
Many investors concerned with market volatility turn to U.S. Treasury Securities (“Treasuries”). There are many types of US Treasury securities including treasury inflation protected securities. Below are the basics of treasury securities.
- Types of Treasuries
There are four types of treasuries. Treasuries are issued in four classes: bills, notes, bonds and Treasury Inflation Protection Securities (TIPS). Most Treasury issues are non-callable, eliminating early redemption and reinvestment risks.
- Treasury STRIPS Zero Coupon Bonds
In addition to Treasury securities, the U.S. Government also issues Treasury STRIPS, which represent the largest and most liquid segment of the Treasury zero coupon bonds marketplace.
- Fixed Income Securities
Fixed income securities are those investments that yield fixed income. All bonds are fixed income securities. Stocks are not fixed income securities because stocks do not guarantee fixed income.
- Tax-Exempt Reset Securities
Investors seeking competitive after-tax short-term returns may be interested in tax-exempt reset securities, such as Tax-Exempt Auction Rate Preferred Securities (ARPS), Municipal Auction Rate Securities (MARS) and Variable Rate Demand Bonds (VRDBs).
- Money Market
Money market instruments are highly liquid, short-term, debt obligations primarily issued by banks, finance companies, corporations and state and local governments.
- Mortgage-Backed Securities
Mortgage-Backed securities have been used as an alternative for bond investing. Mortgage-backed securities can perform the same function as bonds but often with more attractive returns. The market values of mortgage-backed securities decline as interest rates rise. The following examples explain mortgage-backed securities.
- Collateralized Mortgage Obligations (CMOs)
Collateralized Mortgage Obligations or CMO are among Wall Street's latest trendy investments. Collateralized Mortgage Obligations or CMO are invented by Wall Street just as the government invented mortgage bonds in the 1960s. However, few people actually understand what Collateralized Mortgage Obligations or CMO are.
- Corporate Bonds
About corporat bonds including types of corporate bonds, credit qualify ratings of corporate bonds, and callable corporate bonds.
- $25 Par Preferred Securities
Specifically designed for individual investors, $25 par preferred securities constitute virtually all of the newly-issued preferred securities brought to market as well as most of the preferred securities available in the secondary market.
- Convertible Securities
This section of All about Bonds discusses convertible securities. Convertible securities usually refer to bonds or perferred stocks. Examples of convertible securities are convertible preferred securities, convertible bonds, and beneficial unsecured convertible securities.
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