Investing in bonds: Look out for….

With interest rates stagnant – and perhaps moving south bonds may become an interesting option for some investors. Though I am not a great lover of bonds, I do hold some in my Dad’s portfolio. If you are investing in bonds, look out for the following:

1. Are there call and put options – if so European or American. If at intervals, what is the frequency.

2. dates of interest payments

3. Credit rating – higher the better

4. Tax implications – interest or capital gains. Backed by legal opinion or by a court ruling

5. If there is any novel feature that you cannot understand, ASK the issuer

6. Norms for multiple application – will it be rejected or treated separately?

7. Interest on application money?

8. Direct credit to bank – for interest, redemption, etc.

9. Rate of interest

10. Size of issue etc.


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One Response to “Investing in bonds: Look out for….”

  1. How does a retail investor get into buying/ trading bonds?

    Is there a minimum ticket size?

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