The Best Bond Investment Strategy For Risky Investors

Deb C.

The best bond investment strategy is entirely personal and will depend largely on the amount of risk you want to take.

Understanding Agency Ratings

A company’s agency ratings are what will give you an idea of that company’s ability to pay the required interest and principal payments on the debt owed. The higher the rating, the less the overall yield of the bond.

Bonds and the Economic Cycle

The best time to invest in bonds is during recessions, when your money is more sought after and you can get a higher yield without as much risk.

Bond Options

There are several popular options available for your bond asset allocation. Emerging markets bonds usually are typically a safer bet with a higher yield. Emerging market bonds have a greater chance of building up over time without as much worry of bankruptcy.

Zero coupon bonds are another option because they allow a bond to be bought at a discount price, but do not offer any payout over time. Instead, full payout is made after the rest of the bond price is paid and the bond matures.

Keeping this basic information on bonds in mind will help you to choose the best way to place your money in bonds.

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