How To Invest In Bonds [A Simple Beginner’s Guide]

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When you start investing, you are probably focused on low-cost index funds or individual stocks.

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When you want to diversify your portfolio and lower the risk you’re taking, bonds are the perfect fit.

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Here’s everything you need to know about bonds and how to invest in bonds.

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A bond is a way to raise money by corporations or governments. When you buy a bond, you buy a part of a loan with the promise to repay this loan to you plus a certain percentage of interest.

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Bonds are generally less risky than stocks. The value of bonds doesn’t change as much as the value of stocks.

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Bonds mean that you buy an asset in exchange for your cash. It means that you have less liquidity in your portfolio.

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When you are 100% invested in stocks, you can diversify your portfolio by investing in bonds.

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FOR MORE ABOUT THIS POST, VISIT RADICAL FIRE

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