Bond Market Rules : 50 Investing Axioms to Master Bonds for Income or Trading

In today's go-go market, investors' attitudes toward risk--as well as toward bonds--have undergone a dramatic transformation. The new rules of bond investing are complex, often confusing, and if misunderstood, potentially expensive. BOND MARKET RULES provides concise, easy-to-read explanations--from investing fundamentals to advanced trading strategies--to give you a comprehensive overview of bond investing. In addition, it is an ideal fingertip reference to today's most trusted rules, helping you know at a glance how a bond should act in any given situation--and just as important, how you should act to protect your investments. Individually, any one of the 50 chapters in BOND MARKET RULES could save you a fortune in portfolio blunders and miscues. Collectively, they provide nothing less than the most comprehensive manual available on knowing the bond market inside and out. For example: Chapter 3 discusses the true meaning and importance of the yield curve, a popular yet often misunderstood bellwether of possible changes in the economy. Chapter 16 explains the "ladder" strategy--and how it can provide liquidity for long- term bond investors, while minimizing the effects of reinvestment risk. Chapter 27 describes the pluses and minuses of the popular zero coupon bonds, and why they are often preferred for retirement investment accounts. Chapter 49 discusses the promising but volatile new "Brady" bond--what it is, how it works, and why February and March are often the most profitable months to buy a Brady. Simply put, bonds should be a part of any diversified portfolio. In addition, new attitudes and investment products have made the fixed-income market as exciting and potentially rewarding as the stock market. By presenting and explaining the usefulness of today's top 50 professional bond trading rules, BOND MARKET RULES will tell you everything you need to know about this vibrant, potentially lucrative market. On its own, or in combination with author Michael Sheimo's other nuts-and-bolts guidebooks, it will give you a comprehensive knowledge of the fixed-income investment world, and show you the safest, most profitable ways to include bonds in your diversified portfolio. Copyright......Page 6 C O N T E N T S......Page 9 P R E FA C E......Page 11 C H A P T E R 1: When Interest Rates Rise, Bond Prices Fall......Page 15 C H A P T E R 2: The Coupon Is Not Always the Same as Yield......Page 27 C H A P T E R 3: Follow the Yield Curve......Page 31 C H A P T E R 4: Beware the Inverted Yield Curve......Page 39 C H A P T E R 5: There Are Four Ways to Get a Higher Yield on Bonds......Page 45 C H A P T E R 6: Utility Stocks— A Higher-Yield Alternative to Bonds......Page 53 C H A P T E R 7: Long Maturities Have Greater Market Risk......Page 61 C H A P T E R 8: Short Maturities Have Greater Reinvestment Risk......Page 65 C H A P T E R 9: Bond Funds Are Not the Same as Bonds......Page 69 C H A P T E R 10: Buy Bonds That Won’t Outlive You......Page 73 C H A P T E R 11: Invest in Bonds If You Want Steady, Fixed Returns......Page 75 C H A P T E R 12 : Invest in Bonds If Your Risk Profile Is Lower......Page 85 C H A P T E R 13: Invest in Bonds If You Do Not Want Capital Erosion......Page 89 C H A P T E R 14: Why T-Bills Can Be Risky......Page 93 C H A P T E R 15: Know the Bond Options......Page 97 C H A P T E R 16 : Build a Ladder......Page 103 C H A P T E R 17: Bonds, the Buy-and- Hold Investment......Page 109 C H A P T E R 18: Bonds Lower Portfolio Risk......Page 113 C H A P T E R 19: Calls Always Benefit the Issuer......Page 115 C H A P T E R 20: The Simplest Strategy......Page 119 C H A P T E R 21: Bond Investing Is Prudent Asset Allocation......Page 123 C H A P T E R 22: Pay Yourself First......Page 127 C H A P T E R 23: Be a Futures Hedger or a Speculator......Page 131 C H A P T E R 24: Buy Inflation Protection Bonds......Page 137 C H A P T E R 25: Buy Stocks with Bonds (Convertibles)......Page 141 C H A P T E R 26: Beware the GNMA......Page 143 C H A P T E R 27: Put Compound Interest to Work with Zeroes......Page 145 C H A P T E R 28: Understand the Indexes......Page 149 C H A P T E R 29: Do the Barbell......Page 153 C H A P T E R 30: Do Bond Market Analysis......Page 157 C H A P T E R 31: Check Out the DANs......Page 169 C H A P T E R 32: Don’t Fight the Fed......Page 173 C H A P T E R 33: Watch the Stock Market......Page 179 C H A P T E R 34: Look for a Flight to Quality......Page 185 C H A P T E R 35: Buy “Junk” Bonds for Higher Yield......Page 187 C H A P T E R 36: Do “Swaps” for Money Now......Page 191 C H A P T E R 37: You Don’t Have to Pay Taxes on Bonds......Page 195 C H A P T E R 38: Bonds Are Safe If Held to Maturity......Page 203 C H A P T E R 39: Know the Bond Rating......Page 207 C H A P T E R 40: Watch the Consumer Price Index......Page 213 C H A P T E R 41: Insured Municipal Bonds Are Safer......Page 219 C H A P T E R 42: Watch the Long Bond......Page 223 C H A P T E R 43: You Can’t Trade Bonds Like Stocks......Page 229 C H A P T E R 44: Bonds Always Mature at Par......Page 233 C H A P T E R 45: If a Yield Looks Too Good to Be True, It Probably Is......Page 235 C H A P T E R 46: Beware of Personal Guarantees......Page 237 C H A P T E R 47: Know the Types of Bonds......Page 239 C H A P T E R 48: Consider a Managed Futures Account......Page 243 C H A P T E R 49: Buy Brady Bonds for High Yields......Page 247 C H A P T E R 50: Learn the Language of Bonds......Page 253 Index......Page 261 ABOUT THE AUTHOR......Page 273 Bond Market Rules examines 50 of the bond market's most well-known rules and axioms, explaining the fundamentals behind each one, and revealing whether it is valid in today's fixed-income environment. In addition to taking you inside the rules, Bond Market Rules takes you inside the market itself--revealing everything from exactly what constitutes a bond to how speculators chase equity-style returns in the bond market.Internationally renowned investment market expert Michael Sheimo's latest addition to his "Rules" series tells you everything you need to know to increase your potential for higher bond income and sidestep the disasters that can be hidden in the details of these seemingly safe investments. "Bond Market Rules examines 50 of the bond market's most important rules and axioms, explaining the fundamentals behind each one and revealing whether it is valid in today's fixed-income investment environment. Michael Sheimo's latest nuts-and-bolts guidebook tells you everything you need to know to increase your potential for higher bond income and sidestep the disasters that can be hidden in the details of these seemingly safe investments." "In addition to taking you inside the rules, Bond Market Rules takes you inside the market itself - revealing everything from exactly what constitutes a bond to how speculators chase equity-style returns in the bond market."--Résumé de l'éditeur "Bond Market Rules examines 50 of the bond market's most important rules and axioms, explaining the fundamentals behind each one and revealing whether it is valid in today's fixed-income investment environment. Michael Sheimo's latest nuts-and-bolts guidebook tells you everything you need to know to increase your potential for higher bond income and sidestep the disasters that can be hidden in the details of these seemingly safe investments.". "In addition to taking you inside the rules, Bond Market Rules takes you inside the market itself - revealing everything from exactly what constitutes a bond to how speculators chase equity-style returns in the bond market."--BOOK JACKET. A valuable compendium of the fixed income market's 50 most beloved and respected axioms--also a concise resource covering every basic bond investing concept. 30 illustrations.