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The Basics of Bond Investing - Making the Process a Great Deal SimplerIf you invest in a bond and the interest rates begin to fall, this will actually cause the value of your bond to rise. If the interest rates rise on the other hand, this is going to cause the value of your bond to fall. This is because as the interest rates begin to change, any existing bonds with fixed interest payments or coupon rates, bonds that do not float with market interest rates and bonds with zero-coupon interest rates have to adjust in price so that the same rate can be provided when a new bond is issued. The risk rate is the risk that the price of a bond is going to vary as the interest rates change.
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Article Tags: Bond Investing, Investing In Bonds, Bond Investments Article Source: http://www.articlesbase.com/investing-articles/the-basics-of-bond-investing-making-the-process-a-great-deal-simpler-416747.html About the Author:
Craig Thornburrow is an acknowledged expert in his field. You can get more free advice on a savings bond and buy savings bond at http://www.foreverbonds.com
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