Bonds - What Are Bonds?
The bond market is made up of of securities that are in actual fact loans from investors to borrowers. Not limited to just companies and organizations, governments are one of the major bond issuers in the world. The purchasers of these bonds can range from individuals to banks to insurance companies.
The coupon, is how the owner of the bond gets paid. And the coupon is in effect the interest rate paid to the investor over a specific amount of time. Bonds are also well-known as fixed income securities due to the fixed interest rate that is accepted at the start.
So why should we invest in the bond market?. There are some advantages that bonds have over other investments such as the stock market. Investing in bonds imply buying debt rather than equity. Debt-holders always get paid before shareholders should a crisis emerge.
The bond market is more often than not a lot more dependable than other markets are. That is not to say there are no high risk bonds on the market. There always are. Rather, bonds offer a cautious investment opportunity. Bonds offer safety but not the kinds of profits offered by other investments. It is because of the conservative nature of bonds that most people fore-go the opportunity to invest in the bonds market.
The United States od America is by far the chief issuer of bonds in the world. While not as significant as the stock or currency market, the bond market did see as much as 80 trillion trading for the year 2008.
Dabbling in the bonds market does have its downside. Big profits come only to those that purchase large quantities outside the means of most. Secondly, it may not be easy selling your bond should you intend to give it up. The forex market on the other hand enables us to sell with relative ease. Last of all, you cannot trade bonds like you would forex online.
By and large, bonds offer a stable investment prospect to the Malaysian public and should be part of your investment portfolio. Those of you in Malaysia that are on the conservative side should feel comfortable with the bonds market. Profits are on the low side owing to its conservative nature. - 23218
The coupon, is how the owner of the bond gets paid. And the coupon is in effect the interest rate paid to the investor over a specific amount of time. Bonds are also well-known as fixed income securities due to the fixed interest rate that is accepted at the start.
So why should we invest in the bond market?. There are some advantages that bonds have over other investments such as the stock market. Investing in bonds imply buying debt rather than equity. Debt-holders always get paid before shareholders should a crisis emerge.
The bond market is more often than not a lot more dependable than other markets are. That is not to say there are no high risk bonds on the market. There always are. Rather, bonds offer a cautious investment opportunity. Bonds offer safety but not the kinds of profits offered by other investments. It is because of the conservative nature of bonds that most people fore-go the opportunity to invest in the bonds market.
The United States od America is by far the chief issuer of bonds in the world. While not as significant as the stock or currency market, the bond market did see as much as 80 trillion trading for the year 2008.
Dabbling in the bonds market does have its downside. Big profits come only to those that purchase large quantities outside the means of most. Secondly, it may not be easy selling your bond should you intend to give it up. The forex market on the other hand enables us to sell with relative ease. Last of all, you cannot trade bonds like you would forex online.
By and large, bonds offer a stable investment prospect to the Malaysian public and should be part of your investment portfolio. Those of you in Malaysia that are on the conservative side should feel comfortable with the bonds market. Profits are on the low side owing to its conservative nature. - 23218
About the Author:
Click here for more reading on Bonds and Finance in the links mentioned. The Author has been investing online for over 7 years. When Prema De Silva is not trading the currency markets, she expands her knowledge on online investing and oversees the operation of a popular mutual Funds trading website.
posted by X - Men @ 2:34 AM
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