Tuesday, November 6, 2007

Bond investments

Investment companies allow individual investors the ability to participate in the bond markets through

bond funds, closed-end funds and unit-investment trusts. In 2006 total bond fund net inflows increased

97% from $30.8 billion in 2005 to $60.8 billion in 2006. [4] Exchange-traded funds (ETFs) are another

alternative to trading or investing directly in a bond issue. These securities allow individual

investors the ability to overcome large initial and incremental trading sizes.

Bond indices

Main article: Bond market index

A number of bond indices exist for the purposes of managing portfolios and measuring performance,

similar to the S&P 500 or Russell Indexes for stocks. The most common American benchmarks are the Lehman

Aggregate, Citigroup BIG and Merrill Lynch Domestic Master. Most indices are parts of families of

broader indices that can be used to measure global bond portfolios, or may be further subdivided by

maturity and/or sector for managing specialized portfolios.

No comments:

Search 2.0