Corporate Bonds

Posts Tagged ‘corporate’

Question: Wanting to expand my financial knowledge.

I need some suggestions. I am currently earning an associates degree in management/marketing.... However, I am really interested in finance and i want to earn a bachelors degree in finance... I pretty much know all about stocks, mutual funds, bonds, pretty much all the basics plus some... But since I have an interest in this what more should i learn? For example is there any sites explaining what is needed to know about corporate finance? Or what is other criteria I should know? thanks!

Answer: I teach a survey class on Corporate Finance, so I try to read promising books on the topic. Here are a couple of books I would recommend:

Berman, Karen, and Knight, Joe. Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean. Boston: Harvard Business School Press, 2006. Very readable overview of financial reports that emphasizes the decisions behind how the numbers are tracked and reported.

Bogle, John C., The Battle for the Soul of Capitalism. Yale University Press; New Ed edition, 2006. The author, founder and former CEO of Vanguard Financial Group, has been called “the conscience of the (financial) industry.” In this book he examines causes of the bubble of the late 1990’s and considers how much threat still lurks in today’s business and investment practices. Since you are just getting started in business, you will be facing the issues Bogle outlines; hopefully, you will also contribute to their resolution,

Adam Bold - Back to Basics: Rebuilding Your Personal Wealth

Question: What kind of return do Corporate Bonds usually provide?

If I were to invest, say, $20,000 in Corporate Bonds what kind of return can i expect compared to government securities.
Also, what is the average amount of time that Corporate Bonds take to fully mature?
I'm looking for a somewhat shorter-term, higher risk, higher return type of investment. Do any of you seasoned investors have any great ideas or advice? I'm fairly young (22) so I can handle the risk and am able to recover from losses.
And i already have a Roth IRA, and a small long term investment portfolio, so please, no one tell me to save for retirement. I'm already on it.

Answer: You can get some corporate bond yields at the link below. Corporate Bonds usually take between five and 30 years to mature.

Commercial Paper is shorter term -- but is not high risk, and has lower yields.

Bonds come with a face value of $1000 -- and usually sell in lots of 100 bonds ($100,000 face value). Therefore, you would not be able to put together a well diversified portfolio unless you are able to invest several million dollars.

If you are looking for something with a regular income, I would suggest a high dividend stock or preferred stock. Interst on bonds is taxed at your ordinary income rate -- but income on dividends is taxed at 15%.

Why Do Corporate Bonds Yield More than Treasury Bonds?