Archive for May, 2006
Corporate Bonds Coupon
May 4th, 2006
Question: If I buy a bond trading at 80 that matures in 1 year , can I yield 20 % plus the coupon rate ?
I know very little about bond trading and just started researching two weeks ago.
I have seen Corporate Bonds on Etrade that have ratings of A- , A or AA- that have this scenario . Some of them have a negative outlook because of the current economic situation . Is a fixed yield of 25 % worth the default risks ? Is it a normal situation to sell them at these discounts ?
Answer: it is probably not a default risk in the historical sense, but rather the refinancing risk. keep in mine that ratings are worth squat - so your basis for risk assessment is flawed. judge your outlook and cash flow projections, not ratings. for example, GE is AAA and by the skin of its teeth barely avoided a refinancing crisis as it received the FDIC guarantee for debt it must refi.
Could be a good deal, but do your own homework, not rating agency b.s.
What Are Municipal Bonds? - Profit From Municipal Bonds
Posted in Corporate Bond Investing | 
Tags: banking, corporate bonds coupon, corporate bonds coupon frequency, finance, financial, money, mortgage | 
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Corporate Bonds Investment
May 2nd, 2006
Question: could someone elaborate on investment grade Corporate Bonds on the secondary market?
Answer: If someone has a bond and they don't want to hold it until maturity, they can sell it to some other investor. This is called the secondary market.
Peter Kwaak (Robeco) on Robeco Investment Grade Corporate Bonds
Posted in Corporate Bond Investing |
Tags: business, corporate bonds investment, finance, investing, money, stocks |
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