Bonds: Most Popular Articles
One of the most important things for bond investors to understand is the difference between coupon and yield. Coupon tells you what the bond paid when it was issued, but the yield to maturity tells you how much you will be paid in the future.
Learn the basic definitions of premium bonds and discount bonds, why discount bond aren't necessarily a value, and why premium bonds shouldn't be thought of as “expensive”.
class="no-js" itemscope itemtype="http://schema.org/Article" > itemprop="description" >The Current Status
Get the plain-English explanation of why bond prices and yields move in opposite directions. Why do bond prices rise when yields fall, and vice versa?
Find out the differences among the three types of government bonds: Treasury bills, Treasury notes, and Treasury bonds.
Find out what a. Bonds.
Investors are always told to diversify their portfolios between stocks and bonds, but what’s the difference between the two types of investments? Here, we look at the difference between stocks and bonds on the most fundamental level.
China owns a large, and growing, percentage of the United States' debt. How large is China's position in U.S. Treasuries, and does it matter?
When will the Fed raise rates? That's the question on all investors' minds given the role Fed policy has played in the performance of both stocks and bonds. Get the layperson's explanation of why rates are so low, what it would take for the Fed to raise rates, and what higher rates would mean for your portfolio.
Find out how bond market performance compares to stocks in the past ten years, and learn which segments of the bond market provided the best returns. The historical bond market performance data tells an interesting story about the importance of bonds in portfolio diversification.
Bonds can be either secured or unsecured. See the definition, differences, and risk and yield characteristics of these two types of bonds.
An easy-to-understand guide to the 2014 bond market outlook, with expert opinions and a summary of the factors likely to impact bond returns in 2014.
Year-by-year return data: the annual total return for stocks and bonds in each calendar year from 1980 through 2013. Which delivered better performance?
The European debt crisis is the shorthand term for the region's struggle to pay its debts. Here is a Q&A to help familiarize you with the basics of, and outlook for, the European debt crisis.
An easy-to-read explanation of how changes in inflation will affect your bond investments.
fiscal cliff us economy terms. Bonds.
See the long-term, historical yield charts for 2-year, 5-year, and 10-year U.S. Treasuries, together with a brief description of the forces influencing Treasuries' yield movements over time.
The yield spread is a key metric that bond investors can use to gauge how expensive or cheap a particular bond, or group of bonds, might be. Learn how understanding yield spreads can help you make better investment decisions.
Get the list of all bond mutual funds ranked 4-Star and 5-Star by Morningstar.
The differences between short-term, intermediate-term, and long-term bond funds: risks, returns, and determining what mix is right for you.
Learn how to determine which investment is more appropriate for your objectives: short-term bond funds or money market funds.
Learn basic bond definitions: what are issue size, issue date, maturity value, coupon, and yield to maturity.
Bill Gross has left PIMCO for greener pastures at Janus, and there's a lesson here for individual investors: active management can lead to market-beating returns, but it also carries significant risks.
Target maturity bond funds can help investors bridge the gap between the diversification of bond funds and the greater certainty of bond ladders.
An easy-to-understand explanation of the difference between a distribution yield and an SEC yield. Which yield calculation should you use, and why does it matter?
A definition and explanation of the Federal Reserve's quantitative easing policy, the differences between QE1, QE2, and QE3, and how quantitative easing affects the financial markets.
A look at these bonds whose yields adjust with changes in prevailing interest rates;their benefits and pitfalls;and the best way to invest in them.
Treasury Inflation-Protected Securities (TIPS) can be used to calculate inflation expectations using some very simple math. Find out how to comparing TIPS and U.S. Treasuries can tell you where the market sees future inflation.
Investors who need to keep their money safe have a wealth of options to consider in the world of bonds and bond and mutual funds. Learn about some of the lowest-risk options in bonds, and whether low-risk bonds are right for you.
Deflation vs. disinflation: the difference between the two, and what each means for the economy and financial market performance.
Bonds are among the safest investments in the world. But no investment is entirely risk free. In fact, fixed-income investing has its own particular forms of risk, including inflation risk, reinvestment risk, default risk and downgrade risk.
Learn the difference between a bond's yield to call and yield to worst, and how these relate to the bond's yield to maturity.
Convertible bonds are bonds that are issued by corporations and that can be converted to shares of the issuing company's stock at the bondholder's discretion. Convertible bonds typically offer higher yields than common stock, but lower yields than straight corporate bonds. Learn more about the basics of convertible bonds.
Learn about how commercial mortgage-backed securities (CMBS) work, and how individual investors can participate in this market sement.
The newest addition to the U.S. bond market is similar to the asset-backed securities that led to the credit crisis, but supposed to be much safer.
Fed policy explained: An up-to-date rundown on all aspects of current Federal Reserve policy, including interest rates and quantitative easing.
Third Quarter 2014 Bond Market Returns: performance data and key events for the quarter, including high yield bonds' underperformance, the rally in Treasuries and municipal bonds, and the impact of U.S. dollar strength.
Careers in bond trading can be enormously rewarding from a financial perspective. Competition for these jobs at the giant investment banks and other financial institutions is fierce. And the markets modernize, the floor traders of old are being replaced by a new breed of trader skilled in math and computer programming.
There are two major categories of municipal bonds: general obligation bonds and revenue bonds. Here is the easy-to-understand explanation of the difference between general obligation and revenue bonds.
There's more to a bond fund's return than simply its yield. Investors must also consider the fund’s total return, which is the combination of yield and the return provided by principal fluctuation. Learn the difference between yield and total return, and which measure is more useful in assesing bond funds.
Learn about 12 types of bonds, from low-risk options such as savings bonds to higher-risk investments such as high yield and emerging market bonds.
Economic trends are a key driver of bond market performance, but the economy affects different types of bonds in different ways. Learn more about the link between bonds and the economy.
Asset backed securities, or ABS: find out the risks, return characteristics, history, and definition, and how they can play a role in your portfolio.
What is a bullet strategy in bond investing? Find out the definition of bullet strategy, and how it compares to the laddering and barbell strategies.
Investors may be worried about the possibility of interest rate increases by the U.S. Federal Reserve, but one group stands to win when rates rise: savers.
Knowing how to calculate the tax equivalent yield on municipal bonds is a key element of determining whether munis or taxable bonds are right for you.
What currency hedging is, how many managers employ currency hedging strategies, and how hedging can affect the performance of bond funds. What's the difference between hedged and unhedged funds?
Which bond ETFs will be the best performers in 2014? Three bond ETFs with high yields and below-average interest-rate risk could be top picks for 2014.
Bond index funds are a simple and cost-effective way to invest in bonds. Learn about the key benefits and risks of bond index funds
Buying individual corporate bonds is a complex endeavor. It takes more sophistication and more research than buying a share of stock. Here are some of the key things to consider.
With the likelihood rising that bond yields will move higher in the years ahead, here are six ways to protect your portfolio from rising rates.
The highest credit rating, AAA, is typically reserved for government bonds, but four U.S. corporations are also assigned this gold standard of good credit: Microsoft, Johnson & Johnson, Automatic Data Processing, and Exxon Mobil. Learn more about the Big 4 of AAA-rated U.S. corporations, and why they're rated more highly than U.S. Treasuries.
The U.S. Federal Reserve is under no pressure to raise rates. While it may enact a symbolic rate hike in 2015, rates could stay below 1% well into 2016.
The 2014 outlook for corporate bonds: what factors will drive performance in 2014? See the expected returns, key risks, and one potential opportunity.
Find out why TIPS yields are negative, what this tells us about the economy, and why investors are continuing to buy TIPS despite their negative yield.
Find out what types of bonds can deliver returns when prevailing bond yields are dropping, and which may be hurt.
U.S. Treasuries are generally considered one of the safest – if not the safest – investments in the global financial markets. While this is true, it depends how you invest. If you own Treasuries via mutual funds or ETFs, or if you sell them before they mature, they can in fact be quite risky. Find out more about the potential risks of U.S. Treasury bills, notes, and bonds.
Learn the basic definition of bond upgrades and downgrades, and what changes to a bond’s credit rating may mean for your portfolio.
How do fiscal policy and monetary policy differ, and what impact can they have on your investments?
Money market funds are a popular and safe place for investors to keep cash for the short term. These investment vehicles offer both security and liquidity. But the relatively poor returns offered by this class of mutual funds make them ill-suited for long-term investment.
Those who are looking for ways to generate investment income through dividends often allocate a portion of their portfolios to utility stocks. Find out the performance characteristics and risks associated with investing in utilities.
High-dividend stocks are one of the most popular option for those who need investment income but who don't want to invest their entire portfolio in bonds. Find out more about the best strategies for investing in dividend-paying stocks.
See how much of the United States' debt is owned by foreign countries, what countries own the most U.S. debt, and how their holdings have changed in the past year.
Bonds are often classified as “low risk” or “high risk,” but this is only half of the story. There are actually two kinds of risk: interest rate risk and credit risk. These are two distinct types of risk that can have a very different impact on various asset classes within the bond market. Find out interest rate risk and credit risk will affect the value of your investments.
The complete, updated list of bond exchange-traded funds (ETFs), sorted by category.
Operation Twist was a program conducted by the U.S. Federal Reserve to help stimulate the economy. Learn more about the basics of Operation Twist and its impact on the U.S. bond market.
Find out which types of bonds provide helpful diversification when stocks are in a bear market, and which are most likely to underperfom.
Bonds may not seem to be the natural choice for an IRA, but they play a key role in retirement planning. What types of bonds are the best fit for IRAs?
Learn the meanings of real return, nominal return, and real yield, and how understanding these concepts can help you make better investment decisions.
If you’re new to the world of bonds, it’s easy to be intimidated. Bond investing can be filled with unusual lingo, strange concepts and a lot more talk about math and economics than you’ll find at the local discount stock broker’s office. But don’t be discouraged. Bonds aren’t as mysterious as they may appear.
For income investors, Master Limited Partnerships, or MLPs, are a potential source of attractive yields. Learn about the role MLPs can play in your portfolio.
Bonds are among the safest investments available. And as a general rule, mutual funds are the safest way to invest in bonds. But that doesn't mean you should jump right in. Here are a few items to consider before you buy a bond fund.
There are many benefits to investing in bonds, including income, diversification, principal protection, and potential tax savings. How can bonds help you achieve your goals?
Historical performance for high yield bonds: find out the year-by-year total returns for high yield bonds vs. both stocks and investment-grade bonds.
class="no-js" itemscope itemtype="http://schema.org/Article" > itemprop="description" >The Yield Curve:
Learn about the risks and historical performance of corporate bonds, their role in your portfolio, and the various ways to invest in corporate bonds.
Find out what a bond default is, what occurs when a bond defaults, how frequently this occurs, and how a default can affect the performance of individual bonds and bond funds.
Municipal bonds underperformed in 2013, but three important factors indicate that the municipal bond outlook is set to improve considerably in 2014.
High Yield Bonds 2014 Outlook: What needs to happen for high yield bonds to keep outperforming in 2014, and what risk factors could derail the rally?
What is duration, and how does duration affect the performance of your bond fund?
Senior loans, also referred to as leveraged loans or syndicated bank loans, offer diversification and attractive yields, but also a unique set of risks. Are senior loans right for you?
2013 Bond Market Performance Review: A comprehensive summary of 2013 bond market returns including key events and performance drivers for each sector.
How do interest rates, the health of issuing corporations, and investors' attitude toward risk work together to affect the returns of corporate bonds?
Find out how TIPS pay interest, the mechanices of TIPS' principal adjustment, and the potential risks of investing in TIPS.
Debt vs. Deficits: an explanation of the difference between a country's budget deficit and total debt, plus helpful links and historical perspective.
Yields on government bonds and short-term investments have fallen to extremely low levels in recent years, punishing those who are investing for income. Find out why yields are so low, and what you can do about it.
Do you own too many bond funds? For most investors, it's easy to achieve your objectives with anywhere from one to three bond funds. Find out how to avoid confusing quantity with diversification.
A yield curve is a simple representation of the relationship between the interest rate that a bond pays and when that bond matures. Learning how to read a yield curve -- and knowing the significance of a flattening or inverted yield curve as well as how to calculate the spread -- is a crucial skill for fixed-income investors.
If you're primary goal in investing is to not lose money, consider buying U.S. government debt. Treasuries are backed by the
Core funds are so named since the idea is that if investors owned only one investment grade bond fund in their portfolio, the core fund could essentially cover all the bases. But do core bond funds truly help investors maximize thier diversification?
Strength or weakness in the U.S. dollar can have a major impact on the performance of global and international mutual funds. Learn how currency movements can help or hurt the value of your international investments.
Investors often use past performance as their main criterion for choosing a bond fund, but there's much more to picking a fund than simply looking at its historical returns.
The 2014 Bond Market Outlook is now available here.
Some bonds have an unusual feature that allows the issuer to
Learn more about the risks of corporate bonds, and the difference between the risk of individual corporate bonds versus corporate bond funds and ETFs.
Bonds are a mystery to many investors. But there's no need for confusion. Once you get past the jargon of yield curves, maturities and Aaa ratings, you'll find a simple and familiar concept. A bond, after all, is nothing more than a loan.
A bond's yield is often an indicator of its risk - the higher the yield, the higher the risk; the lower the yield, the lower the risk. Find out why this is, and why investors should never pick a bond or bond fund solely on the basis of its yield.
Learn about the risks and historical performance of high yield bonds, their role in your portfolio, and the various ways to invest in high yield bonds.
Zero-coupon bond funds and ETFs can be much riskier than individual zero-coupon bonds. Find out the key differences between the two, and determine whether funds or individual zeroes are the better options.
Leveraged bond funds are are investment vehicles that allow experienced investors to achieve daily returns two or three times that of a particular asset class. Find out how leveraged bond funds work, and whether these products are right for you.
For many investors, the idea of earning tax-free returns makes the purchase of a muni bond seem like a no-brainer. But munis aren't for everyone. Unless you're in the right tax bracket, owning a muni can be a very bad move. So let's answer the question: Should you buy municipal bonds?
Reinvestment risk, a challenge all investors face when bond yields are falling, is the risk that future cash flows will need to be reinvested in lower-yielding securities. Learn more about what reinvestment risk is, and how you can avoid it.
The United States large and growing national debt has reached worrisome levels. How does the country's debt affect the outlook for U.S. Treasuries?
Bond credit ratings provide a guide the strength of the issuer’s finances and its future prospects – and allow investors to gain a sense of how likely a bond is to default. Learn more about bond credit ratings, and what each credit tier – from AAA to D – can tell you about an individual bond.
class="no-js" itemscope itemtype="http://schema.org/Article" > itemprop="description" >There is no shortage
On the first Friday of every month, the U.S. Labor Department reports key employment data - including the unemployment rate - in its monthly jobs report. Of all the economic reports released each month, the jobs report has the largest impact on the bond market. Find out why bond yields are so sensitive to the jobs report, and what it means for your investments.
TreasuryDirect is one of the best resources for investors who want to purchase U.S. government bonds, or who simply want to learn more about how the government manages its debt. Find out more about how TreasuryDirect can help you manage your bond investments.
Somewhere in early 2007, one of the more complex and controversial corners of the bond world began to unravel. By March of that year, losses in the collateralized debt obligations (CDOs) market were spreading -- crushing high-risk hedge funds and spreading fear through the fixed-income world. The credit crisis had begun.
The federal funds rate – typically referred to as the fed funds rate – is the rate at which banks with balances on held at the Federal Reserve borrow from one another an overnight basis. How does the federal funds rate work, and what is its impact on the economy?
Learn about the risks and historical performance of mortgage-backed securities, their role in your portfolio, and the various ways to invest in mortgage-backed securities (MBS).
Find out how the Federal Reserve's discount rate works, the impact of the discount rate on the economy, and how the discount rate differs from the fed funds rate.
Learn what the default rate is, how likely bonds in certain categories are likely to default, and how investors can minimize their exposure to default risk.
Are Vanguard bond funds right for you? See the list of all Vanguard bond funds and ETFs, along with tickers, expense ratios, and Morningstar ratings.
What circumstances regarding the economy, investor sentiment, and corporations' financial health typically fuel the best returns for high yield bonds?
If taxes are a concern, but you don't have at least $100,000 to invest, you should consider buying a municipal bond fund. These mutual funds offer the same tax-free advantages of municipal bonds while also offering diversification.
What factors should you consider in determining your appropriate allocation to stocks, bonds, and cash?
What are the risks of high yield bonds? Learn more about the risks of high yield bonds, and the difference between the risk of individual high yield bonds compared to high yield bond funds and ETFs.
Apple stock vs. Apple bonds: While Apple's longer-term bonds offer a higher yield than its stock, AAPL stock is the better option by a number of measures.
The historical performance numbers for short-, intermediate- and long-term bonds. Which category is poised for the best returns in the coming years?
Zero-Coupon Bonds are sold at a deep discount to their face value. In many cases, interest is compounded and paid at maturity rather than during the life of the bond. In other cases, a financial institution
A simple explanation of the debt ceiling debate and crisis: Find out how the debt ceiling works, and how the debate could impact financial market performance.
Second Quarter 2014 Bond Market Returns: see performance data, key events, drivers of outperformance for corporate and high yield bonds, plus a second half outlook.
Understanding the relationship between risk and return in the financial markets: when deciding where to invest your money, it’s always important to remember that with higher return potential comes higher risk.
Find out why using a taxable account to buy a mutual fund before it makes a distribution can actually cost you money.
Hedged high yield bonds ETFs sound good on paper, but there are many reasons why a hedged approach is an inefficient way to invest in high yield bonds.
Get the plain-English explanation of what an inverted yield curve is, and what an inverted yield curve says about the economy.
class="no-js" itemscope itemtype="http://schema.org/Article" > itemprop="description" >Sometimes the
Actively managed vs. passively managed bond funds: the key differences between active and passive management, and which has delivered better returns.
The long bull market in bonds has ended. What can you do to prepare for a new era of sub-par returns for bonds?
Emerging market bonds can provide attractive long-term returns, but they also carry more risk than most segments of the bond market. Find out if investing in emerging market bonds is right for you.
Green Bond primer: What are green bonds, who issues them, and how can individuals invest in these new securities?
Learn more about the risks of money market funds, and whether investors are correct in seeing money market funds as ultra-safe, low risk savings vehicles.
In bonds, face value refers to what is owed to a bondholder when the security matures. By tradition, most bonds in the U.S. have a face value of $1,000.
When is the appropriate time to sell a bond fund? Here are five signs that it's time to sell your bond fund and move on.
Six investments to consider - and three to avoid - for a bond bear market.
Low bond yields don't just equate to lower income for investors; they also indicate that bonds now have less long-term total return potential.
Learn what the debt-to-GDP ratio is, why a manageable ratio is essential, and how the debt-to-GDP ratio can affect bond yields.
Dividend-paying stocks with high yields can seem like an outstanding investment at first glance. However, the highest-yielding stocks can also come with a danger – that the dividend is unsafe or may not be what it appears on the surface. But how can you tell the difference between a legitimate high yield and one that’s too good to be true?
Funds that are linked to the Barclays Aggregate U.S. Index don't provide a full range of diversification. How can you augment your bond index fund?
Finding quality bond market data takes some digging, but there's plenty out there if you know where to look. Here are some of the best free resources on the web for current and historical bond market data.
Morningstar star ratings can help you choose mutual funds, but they have three important limitations. Why even a 5-star fund may not be right for you.
Inverse bond funds can be an effective short-term vehicle for sophisticated investors to bet against the bond market. However, inverse bond funds also come with substantial risks.
High yield municipal bonds offer higher income than investment-grade muni bonds, but they also feature greater risks. Should you own high yield munis in your portfolio?
Individual investors who are looking for the best way to invest in bonds have three major options to consider: mutual funds, exchange-traded funds (ETFs), and direct investment. Which type of bond investment is right for you?
Diversification can help reduce risk, but its effectiveness in doing so depends on the way you diversify. Learn the common mistakes investors make when trying to achieve portfolio diversification.
Find out how real estate investment trusts, or REITs, how their historical returns stack up against the risks, and whether you should consider investing in REITs.
What are the risks of municipal bonds? Learn more about the risks of municipal bonds, and the difference between the risk of individual munis compared to mutual funds and ETFs.
What is the flight to quality, and how can you profit when it takes place?
Dividend-paying stocks offer more than just income – if dividends are reinvested, they represent a substantial portion of stocks’ long-term total return. Find out how much of stocks' total return is generated by dividends, and whether high-dividend stocks are right for you.