most reliable investment in the market, representing securities are investments in bonds.In this kind of investments can obtain higher returns than bank deposits.
Bonds are usually purchased at a price below par and redemption of the bonds takes place at a nominal price.The resulting difference determines the yield of the bonds and the proceeds of the investor.
Investments in bonds are similar to bank deposit, in both cases the money is invested by a certain percentage and for a specified period.But in the case of bonds have advantages.
Firstly, bond yields on corporate bonds is higher.Secondly, the money can be picked up without losing accrued interest.Bonds, in contrast to a bank account can be sold without loss of interest, if prematurely close the bank account, the interest is no pay.
bond market is primarily intended for conservative investors.Fluctuations in the price of bonds is paltry compared to the changes in the stock price.In the case of bonds the main income is interest or coupon payments.It is also influenced by changes in the revenue of the market value of the bonds.
Yield bonds of this type varies depending on their reliability.Of the existing market offers investors the opportunity to choose the best combination of risk and return.There are bonds of reliable large companies generally with low interest payments, as well as junk bonds are small businesses with a certain risk, but with high interest rates.The special bond yields provide a company just starting to withdraw its securities on the market.
Features
bonds Bonds - are securities.When buying them, the investor is a creditor of the issuing company, issuing bonds, which are considered debt securities.According to the rules, the issuing company is obliged to pay the bondholder their nominal value at the end of treatment, as well as interest income of the nominal value of the bond.Thus, there is the repayment of the bonds.
investor has the right to sell the bonds early, or wait until the end of the term to maturity of the securities.At the end of this period, they will be repaid.The usual maturity is three to five years.The nominal value and the income transferred to the account of the investor.
buy bonds as well as shares in various ways.You can use the Internet.Get access to all major stock exchange data on the bonds can be with special POS terminals that produce broadcast and bonds account for all bidders.To carry out the purchase of bonds is possible and through a broker, you need only call it to order.
When investing in bonds should pay attention to some key points.Such as maturity, credit quality, including bonds, tax status, conditions of early redemption price, yield, interest rates.After reviewing these factors, the investor can assess the debt, and independently decide what degree of investment in bonds consistent with its objectives.
by maturity bonds fall into three groups.
first includes short-term bonds with maturities of up to five years.The second group of medium-term bonds with maturities of five to twelve years.The third group consists of long-term securities with maturities of more than twelve years.
Note that different bonds have different credit quality.
general investments in bonds is the most reliable investment in the stock market and recommended to those who need to preserve capital and to generate revenue above the bank.
