Articles » Tips On Bond Trading
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Few investments offer as objective an estimate of risk as bonds. Because of some fixed characteristics - par (face value, repaid at maturity), coupon (interest rate, percentage paid in semi-annual payments on the par) and maturity (date principal is repaid) - predicting bond values and risk with some confidence is as much science as art.
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Every bond carries some risk that the issuer will default on repayment of the principal or suspend interest payments. Once that risk is measured (see 'Measuring Risk' elsewhere in this series), then what?


