Bonds are units of corporate debt that are securitized as tradeable assets and issued by firms. A bond is referred to as a fixed-income instrument since it pays debtholders a fixed interest rate (coupon). Variable or floating interest rates are becoming increasingly popular. Interest rates and bond prices are inversely related: as rates rise, bond […]

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. When interest rates rise, what happens to bonds? Market interest rates and bond prices often move in opposite directions, which is a fundamental premise of bond investing. Fixed-rate bond prices

What is the purpose of forming chemical bonds? The basic explanation is that atoms are attempting to achieve the most stable (lowest-energy) state possible. When an atom’s valence shell is filled with electrons or when the octet rule is followed, many atoms become stable (by having eight valence electrons). How are the ties formed? Ions

Bonds are purchased and sold in massive amounts in the United States and around the world. Some bonds are easier to purchase and sell than others, but that doesn’t stop investors from doing so almost every second of every trading day. Treasury and savings bonds can be purchased and sold using a brokerage account or

Because bonds are frequently regarded safer than stocks, they compete with equities for investor cash. Bonds, on the other hand, typically provide lesser returns. In the event of a stock market crash, are bonds safe? Down markets provide an opportunity for investors to investigate an area that newcomers may overlook: bond investing. Government bonds are

Because bonds are frequently regarded safer than stocks, they compete with equities for investor cash. Bonds, on the other hand, typically provide lesser returns. When bonds rise, why do stocks fall? Borrowing becomes more expensive for them when interest rates rise, resulting in higher-yielding debt issuances. At the same time, demand for existing lower-coupon bonds

Most bonds pay a set interest rate that rises in value when interest rates fall, increasing demand and raising the bond’s price. If interest rates rise, investors will no longer favor the lower fixed interest rate offered by a bond, causing its price to fall. In practice, zero-coupon bonds are a good example of how

The bid bond’s purpose is to assure the project owner that if the bidder is chosen, the job will be completed. The presence of a bid bond assures the owner that the bidder has the financial wherewithal to accept the job at the indicated price. What is The Required Bid Bond Amount? You’ll almost certainly

Bonds with a zero coupon pay no interest for the duration of the bond’s existence. Rather, investors purchase zero coupon bonds at a significant discount to their face value, which is the amount the investor would receive when the bond “matures,” or matures. Zero coupon bonds typically have long maturities, with many lasting ten, fifteen,

The history of the United States’ national debt may be traced back to the Revolutionary War. Many states issued debt certificates, bonds, and other types of IOUs to assist war efforts. Unfortunately, most states were unable to pay their financial obligations before the end of the war. Alexander Hamilton, the first Secretary of the Treasury