Corporate Bonds

Posts Tagged ‘government’

Question: (Hopefully) Simple question on stocks?

i read a book on stock valuation and it said that "with long-term corporate interest rates were at approximately 6.5% in 2007, a company with $54 EPS were worth approximately $830/share"

Answer: Typically, stocks are valued in relation to the "risk-free rate." But this is always a government bond/note/bill -- not a corporate bond.

Good luck!

Introduction to Bonds

Question: Investing in Single Bonds as a Small Time Investor?

Is there anyplace where a small investor can buy bonds? And I don't mean I-Bonds or any of those direct Government treasuries. But I mean Corporate Bonds that might be yielding 8% or 12%?? Can you buy just (1) Corporate Bond?

Answer: Of course. Many brokerages support this. However, it used to be that it was quite difficult for an individual investor to get a good deal on buying a bond (and difficult to even find out much about availability and prices). Recently this has gotten easier with the new MarketAxess system -- Fidelity was one of the big adopters of this system. So if you're interested in buying individual bonds in particular, before you select a broker first check out the extent of their bond tools and access to individual bonds.

However, it's hard to diversify your risk as a individual investor in bonds, unless you have substantial funds, so bond mutual funds is still a better choice for most people. Plus it's still just plain easier.

http://www.bondsonline.com/News_Releases/news11260601.php

Bond Outlook: Corporate Bond Sales Soar to $41 Billion, Highest in Eight Months