How to Invest in Bonds?

 First of all : what is a Bond?

Bond is a Financial instrument issued to the holder.



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 Types of bonds include :

  • government bonds
  • municipal bonds
  • corporate bonds

where a person would receive a bond in exchange of loan given to the government, the city or a Corporation. 

Note that Bonds can Also be in mutual funds.

 One of the most common type of bonds is mutual fund.

Example: S&P 500 Fund (index of 500 large cap U.S. companies)


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What is the most convenient way to invest in Bonds?

-You can contact your personal bank to purchase a mutual fund bond,

or you can contact an investment firm.

Later, you can just sell and make a profit.

There is always management fees between 0.5% to 2% from the total amount. 

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Analysis:

Below is 5 years chart for S&P 500 Index, some of the advisers would suggest to keep the 

bond for 2 years to make profit.



Google Finance Chart


Disclaimer: this article does not constitute a financial advice. It's only for information purpose.



Unplash/Micheile Henderson/Free License photo


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