The Money Farm Team

A longer time period has a higher possibility of interest rates rising (and consequently negatively affecting the market price of a bond) than a shorter time period. As a result, investors who purchase long-term bonds and then try to sell them before they mature may find themselves with a significantly depressed market price. This risk […]

Federal income from state, city, and local government bonds (municipal bonds, or munis) is normally tax-free. However, you must record this income when you file your taxes. In most cases, municipal bond income is tax-free in the state where the bond was issued. However, take in mind the following: Occasionally, a state that normally taxes

Treasury bonds are often regarded as one of the safest investments in the world, if not the safest. They are deemed risk-free for all intents and purposes. (Note that they are risk-free in terms of credit, but not in terms of interest rate risk.) Bond prices and yields are usually compared to those of US

As a result, longer-maturity bonds are more susceptible to interest rate risk than shorter-maturity bonds. Long-term bonds have higher coupon rates than short-term bonds of the same credit rating to compensate investors for this interest rate risk. What are the highest-yielding bonds? High-yield bonds, sometimes known as “junk” bonds, are corporate debt securities that pay

Federal income from state, city, and local government bonds (municipal bonds, or munis) is normally tax-free. However, you must record this income when you file your taxes. In most cases, municipal bond income is tax-free in the state where the bond was issued. However, take in mind the following: Occasionally, a state that normally taxes

You buy the quantity of shares you want, just like any other mutual fund, and a skilled money manager scours the fund’s portfolio for the best bonds. Government bond funds, municipal bond funds, and short-term corporate bond funds are the three types of bond funds that are considered the safest. Which sort of connection is

Bond prices decline when interest rates rise (and vice versa), with long-maturity bonds being the most susceptible to rate changes. This is due to the fact that longer-term bonds have a longer duration than shorter-term bonds, which are closer to maturity and have fewer remaining coupon payments. Long-term bonds are also more vulnerable to interest

Federal income from state, city, and local government bonds (municipal bonds, or munis) is normally tax-free. However, you must record this income when you file your taxes. In most cases, municipal bond income is tax-free in the state where the bond was issued. However, take in mind the following: Occasionally, a state that normally taxes

Assets exist in a range of shapes and sizes, with varying levels of liquidity. Liquidity varies even within asset classes – some real estate assets, for example, may be more liquid than others. It doesn’t get much more liquid than cash and cash equivalents. It can be used to buy almost anything and doesn’t need

Bond prices decline when interest rates rise (and vice versa), with long-maturity bonds being the most susceptible to rate changes. This is due to the fact that longer-term bonds have a longer duration than shorter-term bonds, which are closer to maturity and have fewer remaining coupon payments. Long-term bonds are also more vulnerable to interest