Bond features include:
- Principal: Nominal or face amount on which bond issuer pay interest.
- Maturity: The date when the issuer needs to repay the nominal amount is known as maturity.
- Coupon: The coupon is the interest rate that the issuer pays to the holder.
- Yield: The rate of return received from investing in the bond is known as yield.
- Credit Quality: Credit rating agencies may grade the bond quality issued by government or corporation.
- Market Price: The present value of your bond is also known as market price.
How to Invest in Bond
There are many ways for investors to invest in bond. You can invest in individual bond through your brokerage. Other ways to invest is through bond funds including mutual fund, exchange traded fund, and closed end fund. You can also buy bond funds through your brokerages.There are 2 main bond funds such as taxable bond funds and municipal bond funds. Taxable bond funds invest in government and corporate debts. The yield is usually taxable under federal tax and state tax. Municipal bond funds invest in municipality debts issued by U.S. states. The yield of muni bond funds is tax free from federal tax rate and state tax.
Bond Mutual Funds
Popular municipal bond mutual funds are:- Vanguard Intermediate-Term Tax Exempt Fund (VWIUX)
- Vanguard Limited-Term Tax-Exempt Fund (VMLUX)
- Franklin California Tax-Free Income Fund (FKTFX)
- Vanguard Short-Term Tax-Exemp Fund (VWSUX)
- Franklin Federal Tax-Free Income Fund (FKTIX)
- Vanguard California Intermediate-Term Tax-Exempt Fund (VCADX)
- Vanguard Long-Term Tax-Exempt Fund (VWLUX)
- American Funds Tax-Exempt Bond Fund (AFTEX)
- Vanguard High-Yield Tax-Exempt Fund (VWALX)
- Fidelity Muni Income Fund (FHIGX)
- Federated Tax-Free Obligations Fund (TBIXX)
- PIMCO Total Return Fund (PTTRX)
- Vanguard Total Bond Fund (VBTLX)
- Dodge & Cox Income Fund (DODIX)
- Metropolitan West Total Return Fund (MWTIX)
- Templeton Global Bond Fund (TPINX)
- DoubleLine Total Return Fund (DBLTX)
- Vanguard Short-Term Investment Fund (VFSUX)
- T Rowe Price New Income Fund (PRCIX)
- Schwab Government Money Fund (SWGXX)
- BlackRock Strategy Income Opportunity Fund (BSIIX)
- Schwab US Treasury Money Fund (SWUXX)
- Fidelity Strategic Advisers Core Income Fund (FPCIX)
- Goldman Sachs Strategic Income Fund (GSZIX)
- American Funds Bond Fund (ABNDX)
- Vanguard GNMA Fund (VFIJX)
- JPMorgan Strategic Income Opportunities Fund (JSOSX)
- Fidelity Total Bond Fund (FTBFX)
- PIMCO Income Fund (PIMIX)
- Vanguard Intermediate-Term Investment-Grade Fund (VFIDX)
- Loomis Sayles Bond Fund (LSBDX)
Bond ETFs
Top bond ETFs are:- Vanguard Total Bond Market ETF (BND)
- iShares Core Total U.S. Bond Market ETF (AGG)
- iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD)
- Vanguard Short-Term Bond ETF (BSV)
- iShares iBoxx $ High Yield Corporate Bond ETF (HYG)
- iShares TIPS Bond ETF (TIP)
- iShares 1-3 Year Credit Bond ETF (CSJ)
- SPDR Barclays Capital High Yield Bond ETF (JNK)
- iShares 1-3 Year Treasury Bond ETF (SHY)
- iShares MBS ETF (MBB)
- iShares Intermediate Credit Bond ETF (CIU)
- iShares 7-10 Year Treasury Bond ETF (IEF)
- iShares 20+ Year Treasury Bond ETF (TLT)
- Vanguard Intermediate-Term Bond ETF (BIV)
- PowerShares Senior Loan Portfolio ETF (BKLN)
- iShares Short Treasury Bond ETF (SHV)
- iShares National AMT-Free Muni Bond ETF (MUB)
- SPDR Barclays Capital Short Term High Yield Bond ETF (SJNK)
- iShares 3-7 Year Treasury Bond ETF (IEI)
- iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB)
- SPDR Barclays Capital Short Term Corporate Bond ETF (SCPB)
- PIMCO Enhanced Short Maturity Strategy Fund (MINT)
Bond CEFs
Top municipal bond closed end funds are:- Nuveen Municipal Value Fund (NUV)
- BlackRock Muni Target Term Trust (BTT)
- Nuveen Municipal Opportunity Fund (NIO)
- Nuveen AMT-Free Municipal Income Fund (NEA)
- Nuveen Premium Income Muni 2 (NPM)
- BlackRock MuniYield Quality III (MYI)
- Nuveen Premium Income Muni Fund (NPI)
- Nuveen Performance Plus Muni Fund (NPP)
- Eaton Vance Municipal Bond Fund (EIM)
- Invesco Muni Opps. Trust (VMO)
- PIMCO Municipal Income II (PML)
- Invesco Value Muni Income Fund (IIM)
- Invesco Muni Investment Grade Trust (VGM)
- Invesco Municipal Trust (VKQ)
- BlackRock MuniYield Fund (MYD)
- Nuveen Quality Income Muni Fund (NQU)
- PIMCO Dynamic Credit Income fund (PCI)
- DoubleLine Income Solutions Fund (DSL)
- AllianceBernstein Income Fund (ACG)
- EV Limited Duration Income Fund (EVV)
- PIMCO High Income Fund (PHK)
- BlackRock Credit Allocation Income Fund (BTZ)
- Aberdeen Asia-Pacific Income Fund (FAX)
- BlackRock Corp High Yield Fund (HYT)
- First Trust Intermediate Duration Preferred & Income Fund (FPF)
- PIMCO Dynamic Income Fund (PDI)
- BlackRock Build America Bond Fund (BBN)
- Nuveen Credit Strategy Income Fund (JQC)
- Nuveen Quality Preferred Income 2 (JPS)
- PIMCO Corporate & Income Opportunity Fund (PTY)
- AllianceBernstein Global High Income Fund (AWF)
- Calamos Convertible & High Fund (CHY)
- Templeton Global Income Fund (GIM)
- Nuveen Preferred Income Opportunities Fund (JPC)
- Calamos Convertible Opportunities & Income Fund (CHI)
- Flaherty & Crumrine Preferred Secutiries (FFC)
- Invesco VK Dynamic Credit Opportunities Fund (VTA)
- Invesco Senior Income Fund (VVR)
- Voya Prime Rate Trust (PPR)
- AGIC Convertible & Income Fund (NCV)
- Blackstone/GSO Strategic Credit Fund (BGB)
- BlackRock Core Bond Fund (BHK)
- BlackRock Debt Strategies Fund (DSU)
- Western/Claymore Inflation-Linked Opportunities & Income Fund (WIW)
- Western Asset High Income Fund II (HIX)
Other categories of bond funds are:
- Bank Loan
- Convertibles
- Emerging Markets Bond
- High Yield Bond
- High Yield Muni
- Income Preferred Stock
- Inflation Protected Bond
- Intermediate Government
- Intermediate Term Bond
- Long Government
- Long Term Bond
- Multisector Bond
- Muni California Intermediate
- Muni California Long
- Muni National Interm
- Muni National Long
- Muni National Interm
- Muni Short
- Short Government
- Short Term Bond
- Ultrashort Bond
- World Bond
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