| How do I research individual municipal bonds? |
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yandy369
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quote:
Originally posted by coaster
Yes, any one individual investment has 100% risk. When collected into a portfolio of diversified and non-correlated investments, the risk goes down considerably. Which was the point I tried to make above about a bond mutual fund being a more appropriate choice for individual investors. Obviously if you have enough capital to assemble a diversified portfolio of bonds, then the risk is much reduced. There's still the correlation risk, however.
not only individual.
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Mon Apr 18, 2011 3:41 pm |
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LottomagicZ4941
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quote:
Originally posted by coaster
I have to agree. No one individual bond is safe. The definition of safe is, to pretty much all investors, no risk of loss of principal, the amount of risk being the amount of possible loss. Perhaps the probability of loss from a muni bond is low, but the risk is 100%. If the bond defaults, you've lost every penny.
I think that for an individual investor to tie up any significant portion of net worth in individual bonds of any kind isn't wise. If holding bonds in the portfolio is desirable, then it's best done through a bond fund, where the risk is spread, and where if any one bond defaults, the loss to the investor is very, very small.
People say stocks are risky but very rarely is there 100% loss which can happen with a bond.
Back when I was a newbie investor I put 20% of my profilo in bonds. Then I figured stocks win 9 out of 10 years and lowered it to 10%.
May have raised the percentage for a tad before I lowered it.
Increased it to 20% just before Y2K. My teck fund doubled that year!!!
Yes teck tanked later;) But don't forget the gain before the hit---
The most important thing about investing is investing!!!!
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Sun May 01, 2011 1:27 pm |
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jlucero
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so do you invest in muni bonds at all?
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Mon May 02, 2011 4:33 am |
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