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Month: March 2019

How duration affects the price of your bonds

How duration affects the price of your bonds

If you are invested in bonds or bond funds, there is a ratio that you should know: Duration. It helps estimate how much the price of your bond investment will fluctuate as interest rates go up or down. The higher the duration, the more sensitive a bond investment is to changes in interest rates. Many factors influence the prices of bonds, one of which is interest rates. Whether interest rate movements are caused by central bank measures, economic indicators or…

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A brief introduction to the world of bonds

A brief introduction to the world of bonds

  Bonds are debt securities and thus lower risk assets than equities. While these securities do not offer the potential of stocks, they have other merits. They throw off a certain interest. Bonds with good debt quality are therefore considered conservative investments. A bond (also called a bond or a bond) is a debt instrument issued by a state, public corporation or corporation to borrow on the capital market. Basically, it is a contract between one of these parties that…

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