Pro's & Con's of Investing in Bonds

Written by Mika Hamilton


Continued from page 1

The negative side of investing in bonds:

All investment products have drawbacks. Bonds are no exception. Some ofrepparttar negative aspects of investing in bonds are:

Most bonds have a call option. This givesrepparttar 149779 issuerrepparttar 149780 right to call backrepparttar 149781 bonds held by investors generally after five to ten years. Whenrepparttar 149782 issuer calls back a bond, it pays your principal back along withrepparttar 149783 accrued interest and perhaps, a small premium. Issuers adopt this strategy when they can obtain money at interest rates lower than that ofrepparttar 149784 bond in question.

When interest rates go up,repparttar 149785 price at whichrepparttar 149786 bond can be sold goes down. If you are forced to sellrepparttar 149787 bond due to pressing circumstances, you may not backrepparttar 149788 entire amount invested resulting in losses.

Long-term bonds can tend to be volatile and can somtimes fail to keep up with inflation.

Read More Free Investment, Wealth Creation & Personal Finance Articles & Tutorials from the Global Investment Institute.




Getting Started In Investing

Written by Mika Hamilton


Continued from page 1

It is also important to evaluaterepparttar firms history, how stable it is, etc. because ifrepparttar 149778 firm goes out of business chances are you might not be able to recover your money.

A good place to start figuring out what questions to ask of your broker isrepparttar 149779 U.S. Securities and Exchange Commission homepage, they have a detailed page that outlines very good questions to ask. You could also checkrepparttar 149780 library for other investing resources. Make sure to take notes when you ask your questions and write downrepparttar 149781 answers that you received, this showsrepparttar 149782 broker that you are a serious investor.

Its important to consider that, as a beginner inrepparttar 149783 investment world, you are sure to make mistakes. Everyone does, but its your ability to learn from these mistakes that will give yourepparttar 149784 experience necessary to carry on and improve your results. The only logical way to learn from your mistakes is to write down everything you do, and evaluate it thoroughly. This way you will be able to acknowledge what mistakes you make, and help you avoid repeating them.

Read More Free Investment, Wealth Creation & Personal Finance Articles & Tutorials from the Global Investment Institute.




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