You CAN Lose With Bonds

You CAN Lose With Bonds Splash image

Big losses in the stock market have sent many investors scurrying for "safe" investments.

But what is a "safe" investment?

Stocks are risky because stock prices go up and down all the time—sometimes wildly so—and if you have money invested in stocks, the value of your original investment can drop substantially.

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Discussion

Larry Johnson from Minnesota posted 7 months ago:

If I buy a bond and hold it to maturity (5 years or less) will I not receive both initial principal plus the interest?


Earl Manley from North Carolina posted 7 months ago:

When you invest in an individual bond and hold it to "maturity," you won't lose your principal unless the bond issuer defaults.


Sheldon Shapiro from Pennsylvania posted 14 days ago:

What's the potential downside of Bulletshares BSJF ETF, with all holdings maturing by end of year 2015. Investments are high yield with short maturity. Fund holding 128 positions should minimize problem with any defaults.


Charles Rotblut from Illinois posted 12 days ago:

Sheldon,

The answer depends on how much interest rates and credit spreads change between now and the time the fund's bonds mature.

-Charles


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