Bonds
Fixed-income securities that pay interest and return principal at maturity.
Bond prices fall when rates rise; duration measures how much.
Bond prices fall when rates rise; duration measures how much.
Credit quality spans Treasuries, investment grade and high yield.
Key concepts to master
- 01.Total cost of ownership, including fund fees and platform fees
- 02.Liquidity: when, and on what terms, you can get your money back
- 03.Tax treatment and which account type this belongs in
- 04.How this exposure overlaps with what you already own
Common mistakes
- ×Sizing a position based on recent performance rather than a written plan
- ×Confusing infrequent valuation with genuine stability
- ×Ignoring the tax drag of frequent trading in taxable accounts