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re: Bonds. Explanation needed.

Posted on 5/5/15 at 9:32 am to
Posted by Shepherd88
Member since Dec 2013
4592 posts
Posted on 5/5/15 at 9:32 am to
You're not buying a bond for capital appreciation, you're buying it for income..

Just as if you bought a dairy cow for milk, you don't necessarily care what the price of beef is doing because you're goal is the milk production from that cow.
Posted by kennypowers816
New Orleans
Member since Jan 2010
2446 posts
Posted on 5/5/15 at 9:40 am to
quote:

Just as if you bought a dairy cow for milk, you don't necessarily care what the price of beef is doing because you're goal is the milk production from that cow.


Good analogy.



And to the OP, as South said...

quote:

Unless the company defaults, you will get exactly what was stated


This is the only variable if you are definitely holding the bond to maturity and hence the ratings.
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