Investing Advice | InvestingAdvice.com » Bonds

Why Investors Should Consider Muni Bonds Now

walter — Thu, 26 Jan 2012 15:37:50 +0000

The past year has been a nerve-wracking one for many investors. The major stock market indices have been relatively flat, but there have been lots of volatility in the shorter term movements. And it seems like there’s always a threat of some new piece of news sending the stock market sharply downward. While safe investments like certificates of deposits are paying interest at near record lows, there is still an opportunity to access a respectable rate of return without having to expose investment funds to the risks of the stock market. This opportunity comes in the form of municipal bonds,...

Should You Be Buying TIPS Now?

walter — Wed, 07 Sep 2011 14:47:09 +0000

One of the most basic tenets of investing is that U.S. Treasury bonds are some of the safest investments one can make. They’re backed by the federal government, and they are practically guaranteed not to lose value. But when inflation rises, they can’t always keep up, and that means you could still come out behind in terms of buying power. Treasury Inflation-Protected Securities, or TIPS for short, offer a solution to this dilemma. They are Treasury notes and bonds as well, but the principal and interest are indexed to the inflation rate. In effect, they’re inflation-proof. But that doesn’t...

What are TIPS?

admin — Wed, 10 Mar 2010 14:51:00 +0000

You've probably heard about Treasury Inflation-Protected Securities (TIPS). They are treasury bonds that adjust their interest and principal payments with inflation. TIPS will likely become much more popular with the perceived inflation risk that may loom in the future. Like other Treasury securities, TIPS pay interest every six months and repay the total principal amount when they mature. The difference is that TIPS' principal value increases automatically based on the inflation rate as measured by the Consumer Price Index (CPI). So therefore when the CPI rises, the principal value of the TIPS also increases. Interest payments also rise because the...