Investing in bonds is just like investing in stocks.  Investors need to realise that investing in bonds entail risks which could affect the values of bonds.  The major risk of investing in bonds comes from the concern about the issuers’ ability to meet its scheduled interest and principal payments.  If you are investing in bonds, it is important that you adhere to the following investment principles:

* Know yourself and your g (more…)

Debentures are loans, secured by a corporation, municipality or government. Bonds and debentures are instruments that provide for a maturity at which time the principal will be repaid. In addition to the payback of principal, the borrower will pay interest at stated intervals, usually semi-annually.

There are four common types of bonds and debentures:

1. Government bonds and debentures
2. Corporate bonds and debentur (more…)

A bond is a financial asset in the form of a long-term contract under which the firm (borrower) agrees to make payments of interest and principal, on specific dates, to the holders of the bond.  

The value of a bond, as of any financial asset, is the present value of the cash flows that are expected to be generated by the bond. In order to be able to calculate the present value of a bond, we need first to investigate the contractual f (more…)

If you were offered a dollar today or ten dollars next week, which would you choose? What if you couldnt have that ten dollar bill until next month or next year? If you would rather have the cash now than wait, you are in the majority. This is why real estate notes are sold at a discounted rate from the actual value of the note.

Real estate investors use a special formula to determine how much money a note is worth at any g (more…)

Financial instruments found in the debt market include:

1. Term Deposits

2. Government bonds

3. Treasury Bills (T-Bills)

4. Money Market Funds

5. Corporate Bonds and Debentures

6. Domestic Bond Funds.

In this article, we will only discuss the term deposits, government bonds, treasury bills and money market fund.

1. Term DepositsTerm Deposits (more…)