The following article will guide you about how to mitigate interest rate risk. Introduction: Of the two components of interest rate risk, price risk can have a sudden and dramatic impact on your fixed income portfolio. The reinvestment risk is slow and long drawn in its effects. In the long run, interest rate scenarios change and you will most certainly [...]
Bonds can be differentiated in the way they earn income for you. On one hand we have simple annual coupon bearing bonds that pay you interest on a fixed date every year till maturity; while on the other hand, we have cumulative coupon bonds which ensure that your interest too earns interest and pay you the final accrual at the [...]
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 [...]