While bonds are generally considered safer than stocks, they are not 'risk free!. Describe 3 risks in addition to credit or default risk that nvestors should consider when buying bonds.
While bonds are generally considered safer than stocks, they are not 'risk free!. Describe 3 risks in addition to credit or default risk that nvestors should consider when buying bonds.
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
Section: Chapter Questions
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Transcribed Image Text:While bonds are generally considered safer than stocks, they are not 'risk free!. Describe 3 risks in addition to credit or default risk that
investors should consider when buying bonds.
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Bond is referred to as an instrument of an indebtedness of the bond issuer to holders. Most common type of the bonds used to include the corporate bonds as well as municipal bonds. Bonds used to have a mutual funds or private investment, where an individual will give a loan to the corporation/government.
Bond is referred to as the debt security under which an issuer used to owe the debt holders as well as obliged for paying an interest for repayment of principal at maturity date. An interest used to payable at the fixed intervals.
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