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re: Buying bonds in laymans terms
Posted on 12/5/12 at 11:57 am to Nawlens Gator
Posted on 12/5/12 at 11:57 am to Nawlens Gator
quote:
Is there much risk?
Credit risk? No.
Interest rate risk? Yes...a bunch. Even with a duration of 3.4 you could see an entire year's worth of income wiped out in a loss of market value if rates spike up at all.
Posted on 12/5/12 at 12:12 pm to LSURussian
quote:
Credit risk? No.
Interest rate risk? Yes...a bunch. Even with a duration of 3.4 you could see an entire year's worth of income wiped out in a loss of market value if rates spike up at all.
Ditto. You could also see the value of the bond possibly fall to 80 cents on the dollar or worse if it's a considerable spike
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