What are the investment strategies of the bonds? And give a short comment for each.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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What are the investment strategies of the bonds? And give a short comment for each.

Expert Solution
Step 1

A bond is a financial instrument which is used by company to raise funds from outside sources. An investor purchases bonds for which fixed amount of interest is paid till its maturity date.

 

Step 2

The most common strategies that are used in bond investment are as follows:

  • Bond ladder strategy
  • Barbell strategy
  • Bond swap

 

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