Our discussions on bonds continue. After learning the bond basics and making the investment, what should you do with the income? As a refresher, a bond is a debt instrument in which an investor loans money to an entity in return for receiving a fixed or variable interest rate, with interest being paid at regular intervals. The basic rule of the time value of money states that money loses its value with the passage of time. What you can buy today with a certain amount of money will be a lot more than tomorrow due to rising inflation.

Your dream European vacation just got cheaper – 12% on a year-to-date basis to be precise (Full disclosure, this figure applies only to investors with US$ holdings). Have you been considering the purchase of Luxury European Made vehicle? Or perhaps the thrill of exploring Patagonia or hiking the Andes is more appealing to you? Well, all these options are substantially cheaper thanks to the fact that the US dollar has strengthened against most developed and emerging market currencies so far in 2022. Of course, the Jamaican dollar is a notable exception.

Last week my colleague Dwayne highlighted the importance of opening a new account when one closes. As he mentioned technology and high levels of customer service should help make this a seamless process. The real dilemma that many investors face when their accounts are closed is what should they do with the available funds.

From time-to-time situations may arise where an account that you hold may have to be closed, whether voluntarily or involuntarily. This can occur with either a savings type account or an investment account. From the account holder’s perspective, the account may no longer fit into your investment and saving plans and so you voluntarily close the account. You may have achieved the goal you had when the account was opened, or you may have found another type of account that better meets your financial needs.

Ever since the U.S. (the world’s largest economy) contracted in the first quarter of this year, there has been speculation that the global economy could slip back into another recession. The odds were further boosted by the ongoing Russia-Ukraine war, unresolved supply chain issues and aggressive central bank rate hikes in response to alarming inflation levels. The U.S. economy contracted again in the second quarter and has met the technical definition of a recession. However, the National Bureau of Economic Research (NBER) which adjudicates on recession matters in the U.S.

Whenever you think about retirement you probably think of travelling- whether by plane or yacht, or on a cruise to visit exotic locations around the world. You may imagine activities like golfing, fishing, hiking or just laying on beautiful white sand beaches which stretch as far as the eye can see. Retirement is what your ideal life should be after working for so many years. Some people may have been planning their retirement for a lifetime, or so it would seem. You imagine the big day when you say, “Goodbye, it was great working with you! Cheers (said with a please puss smile)!”

Bonds can create a balancing force within an investment portfolio. If you have the majority of your portfolio invested in stocks, adding bonds can diversify your assets and lower your overall risk. So, how do you go about adding bonds to your portfolio and more importantly, why should you?

Investors can buy individual bonds directly from a broker or a licensed securities dealer. But there are some critical things to bear in mind:

My previous article, Bond Basics I, covered several bonds-related concepts, including Face Value, Coupon Rate, Callability, Yield-to-Maturity, and Credit Rating. However, there is still a lot more an investor should know to better understand the seemingly complex world of bonds. Today, we review a few more concepts to help you understand the bond market and better guide your investment decisions.

Today we provide a market recap for investors who are patiently assessing the financial markets and trying to decide when and what to buy. This information will help direct you to pockets of opportunities and provide context for future market moves. Staying liquid is an important tenet of any investment strategy in the current environment.

Bond yields have more than doubled since the end of 2021: