Savings bonds are different from most other bonds in that they pay a greater interest rate. They are detained for a shorter period of time. In exchange for a lower purchase price, the buyer does not receive monthly interest payments. What makes savings bonds unique? The federal government issues savings bonds, which are backed by […]

From the first day of the month after the issue date, an I bond earns interest on a monthly basis. Interest is compounded (added to the bond) until the bond reaches 30 years or you cash it in, whichever happens first. Interest is compounded twice a year. Interest generated in the previous six months is

Governments sell savings bonds to individuals to help support federal spending while also providing a risk-free return. Savings bonds are purchased at a bargain and do not pay interest on a regular basis. Instead, as they get older, their value rises until they reach their full face value. The length of time it takes for

There is a pressing demand for investment in transportation capital infrastructure improvements, which much outnumbers available funds. According to estimates, $51.6 billion per year will be required over the next 20 years to maintain the existing state and performance of the roadway system. This requirement compared to expected spending of $38.7 billion each year, resulting

Market interest rates and bond prices often move in opposite directions, which is a fundamental premise of bond investing. Fixed-rate bond prices fall as market interest rates climb. Interest rate risk is the term for this phenomena. How does the bond market react to rising interest rates? However, a number of factors, ranging from new

“2021 was a big year,” said Tom Kozlik, Hilltop Securities’ head of municipal research and analytics. “In a single year, we saw more fiscal policy focused on public finance than we have ever seen.” However, some investors may now be anticipating the Federal Reserve’s expected interest rate hikes, which could result in price decreases. However,

Bonds and interest rates have an inverse connection. Bond prices normally fall when the cost of borrowing money rises (interest rates rise), and vice versa. How does the bond market react to rising interest rates? However, a number of factors, ranging from new COVID-19 variations to persistent inflation risks to a dramatic monetary policy move

Revenue bonds are a type of municipal bond that is issued to fund public projects and then repaid to investors from the project’s earnings. A toll road or utility, for example, could be financed with municipal bonds, with the tolls or fees collected paying off the interest and principal. Unlike GO bonds, revenue bonds are

A retail bond offering allows a company to raise additional capital by borrowing at a fixed rate from an investor for a specific length of time. Companies typically issue retail bonds to expand their business, pay off debt, or fund a specific project, as with any capital raising. Typical issues aim to generate £10m to

A bond rating is a letter-based credit score system that is used to assess a bond’s quality and creditworthiness. Standard & Poor’s assigned “AAA” to “BBB-” ratings to investment grade bonds, whereas Moody’s assigned Aaa to Baa3 ratings. Bonds with a lower grade are referred to as junk bonds. If all other factors are equal,