Learn about the various shifts observed in the yield curve explained with the help of suitable diagrams. Direction of the Yield Curve: A yield curve can have 3 broad directions: 1. Upward Sloping: This is the most common and 'normal' direction of the yield curve. Its interpretation is that bonds with longer maturities have higher yields than those with shorter [...]
The following points highlight the seven main types of risk on investment. The types are: 1. Interest Rate Risk / Market Risk 2. Credit Risk / Counter-Party Risk 3. Call Risk / Prepayment Risk 4. Put Risk 5. Yield Curve Risk 6. Inflation Risk 7. Sovereign Risk. 1. Interest Rate Risk / Market Risk: If we talk of fixed income [...]
The following article will guide you about determining the tax impact of your investment decision along with few important tips. 1. Interest: The interest that you earn on bonds and debentures is 'earned' every year. You may or may not 'receive' it every year depending upon whether that bond or debenture is cumulative or not. Usually, you pay taxes on [...]