Introduction To Bond Investing
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Learn how you can create a diversified portfolio with bonds.
Most investment choices involve a tradeoff between risk and reward. The "Efficient Frontier" is a modern portfolio theory tool that shows investors the best possible return they can expect from their portfolio, given the level of volatility they're willing to accept.
A convertible bond is a bond the investor can exchange for a specific amount of company stock at a later date. It combines a bond and a call option. The bondholder can benefit if there's an increase in the stock's value. The amount of stock that a bondholder can acquire is subject to a pre-determined formula.
A zero-coupon bond or ‘no coupon’ bond is one that does not disburse regular interest payments. Instead, the investor buys the bond at a steep discount price; that is, at a price lower than its face value. When the bond matures, the investor receives the principal amount or face value. Common zero-coupon instruments include U.S.
Learn about how this number provides a measure of how much systematic risk a firm's equity has compared to the market.
Learn more about the different ways you can calculate your portfolio's average return.
Learn more about this statistical measurement used to represent movement between a security and its benchmark.
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