Bond is a debt security, the issuer owes the debt holders. Depends on the terms of the bond, the issuer is obliged to pay interest coupons or call and / or returning the original capital, at a later date or when 's ripe. Bond issuer may be a company, government or municipalities. That the issuance of bonds to raise funds. The bond's interest rate depends on the strength of the company issued the bond. For example, a first-line company like Wal-Mart, Exxon Mobile, General Electric, which has less risk of defaulting on its debt will give you a lower interest rate than the company first line. Higher interest rate means that the link is more risky. Bonds are considered much safer than stock.
There are several ways to invest in bonds as buying individual bonds or invest in fixed income funds. Most individual bonds are bought and sold in over-the-counter (OTC). In the OTC market are not securities firms and banks that trade bonds, traders who buy and sell bonds on behalf of customers and distributors, who have ties to buy and sell. The bonds sold in the OTC market are usually sold in denominations of $ 5,000. Bond prices in the secondary market usually include a profit margin for the dealer 's profit. Each broker sets their own prices, which vary by the type of link, and the size of the transaction. If you're interested in buying a new bond in the primary market, when first published, their aid will need an investment advisor who will provide everything you need.
Bond funds are like stock funds, professionals select and manage a portfolio of bonds for a fee. There are bond funds that follow a market or benchmark bonds. Bond fund does not have an expiration date because the bonus can be added and removed from the portfolio. Most funds charge annual fees will be management, and some charge to sell or buy the fund. The charges and fees will reduce performance, it is necessary to aware of this when calculating expected returns. Many bond funds also requires a minimum initial investment.
Learn to invest money
沒有留言:
張貼留言