I am looking to invest $10,000, which types of bonds would be my way to go for fast turnaround/most profitable? What ranges of interest rates to they payout, best place to look into bonds. Etc. Thanks.
2007-03-05 12:32:13 · 2 answers · asked by Dana S 2 in Business & Finance ➔ Investing
With $10,000 you should look into a bond fund. Bonds trade at roughly $1000 each, so you would only be able to take a 10 bond position, which isn't adequate to diversify. Plus the transaction fees would eat into the yield. The bond market isn't as liquid for small positions as the stock market is and you have to pay up (decrease the the yield) to take positions at the individual bond level.
That said, if you're set on buying individual bonds, if you're in a taxable situation, you should look into munis to get the tax-free income. Or if you're not taxable, treasuries or the highest grade corporate debt are going to be the best ideas. You could buy high yield, junk, debt, but I don't think you would be able to adequately diversify the risk.
2007-03-05 12:39:47 · answer #1 · answered by BosCFA 5 · 0⤊ 0⤋
Zions Direct has a large selection of bonds. You can buy bonds in chunks so that you, say, every 2 months can have 1/6th of your portfolio that matured. That way you can keep the risk lower and cashflow going.
2007-03-05 13:40:27 · answer #2 · answered by Andre P 3 · 0⤊ 0⤋