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Only purchase bond and fixed income securities via the lowest cost fixed income market index funds

Fixed income trading is a complicated investment undertaking that individual investors ought to leave to professional bond and fixed income market index fund investment portfolio managers. The trading and pricing of fixed income investment securities is substantially more complex than the pricing and trading of equities.

Furthermore, bond price determination is far more opaque, and bond and fixed income investments and the fixed income market has very substantial bid and ask margins. From a realistic perspective, you buy fixed income holdings at “store” price and sell fixed income assets at unfavorable discount wholesale values which substantially favor the bond and fixed income market trading firms.

Individuals benefit, if they learn more concerning no load bonds

Fixed income trading security market pricing is substantially different when compared to the market for stock securities. A public firm usually has just one type of common equity. On the other hand, this same public company might have dozens, even hundreds, of distinct issued fixed income investment instruments. Very few individuals have the necessary experience, skill, and knowledge to assess bond and fixed income investment securities pricing. Bond and fixed income securities have different value characteristics than do common stocks. In addition, issued and outstanding bond and fixed income assets require differing valuation methods.

Common equities give the investor a claim to a portion of the market value of the public firm and to dividend payouts, if the Board declares such dividend payouts. In comparison to stocks, corporate fixed income investment securities provide their holders a superior right to the publically traded company’s cash flow to fund bond and fixed income security principal plus interest payouts. When bond owners’ claims to the publically traded company’s cash flow are not satisfied, then default might be required.

A firm could be required to recapitalize in bankruptcy court, and all equity ownership may pass to its creditors and bondholders. These bankruptcy proceedings usually are very distasteful, slow, and difficult processes.

This is referred to as the default risk. Projections about the varying likelihood of failure to repay could cause very large differences in price for fixed income and bond investment securities that otherwise might have similar pricing. Projecting whether bond and fixed income obligations are likely to be made by fixed income and bond issuing enterprises within the life of the fixed income security is best left to professional fixed income market index fund portfolio managers.

A fully automated, do-it-yourself financial planner with a personal money management program is needed to establish a much more reasonable long-term money management strategy that utilizes fixed income and bond assets

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