- Bank Draft
- Bonds
- CFD
- Indexing
- P/E Ratio
- Rally
- Risk
- Term Deposits
- Trading Dictionary
- Trading Indicators
Bonds are fixed-income financial instruments. The characteristics of bonds are security, no liquidity issues, income, diversification.
The price of bonds rises when cash rates fall. This is because bonds are locked at a fixed-rate and the owner benefits when official variable cash rates are going lower.
Bonds are securities that represent debt. They are issued by governments, companies, or other entities. Basically, they are simpler than equities and less volatile. They mature after a fixed period of time and earn a fixed interest rate.
Main points to watch
- yield curve
- spreads to Treasuries
- benchmarks (indices)
Yield curve is a graph that shows the yield for bonds with different maturity dates. Euro area yield curve (link)
Risks
- Risk of default
- Market risk
- Issue-specific risk
- Event and other risks
- Reinvestment risk
Links
- Learn about bonds, Barclays, (link)
- Fixed Interest Basics, Vanguard (link)
- Investing in Bonds
- Bondbook (fixed income)
