As mentioned in my previous posting, I am sharing my views on fixed income securities, which refers to financial products that offer investors a return in the form of fixed periodic payments (coupon) and the eventual return of principal at maturity. Example of fixed income securities include government bonds and preference shares issued by companies.
Benefits of Investing in Fixed Income
Historically, the returns of stocks and
bonds moved in opposite directions at the same time. Investors can reduce their portfolio risk through diversifying their investments on fixed income securities, which offer investors a predictable income stream during times of market volatile. Fixed income securities are very transparent in the sense that investors would know how much interest they can expect to receive, how often they will receive it and when they can get back their principal investment monies. Investors can also check the prices in real-time and the volume …