Bond Investing For Dummies
- Used Book in Good Condition
Your friendly guide to trading the bond and bond fund market
Bonds and bond funds are among the safest and most reliable investments you can make to ensure an ample and dependable retirement income—if you do it right! Bond Investing For Dummies helps you do just that, with clear explanations of everything you need to know to build a diversified bond portfolio that will be there when you need it no matter what happens in the stock market.
This plain-English guide clearly explains the pros and cons of investing in bonds, how they differ from stocks, and the best (and worst!) ways to select and purchase bonds for your needs. You’ll get up to speed on the different bond varieties and see how to get the best prices when you sell.
- Covers the ups and downs of today’s market, which reinforces the importance of bonds in a portfolio
- Explains how a radical fall in interest rates make bond investing trickier than ever
- Explores the historic downgrade of U.S. Treasuries and its possible effects on government bonds
If you’re an investor looking for a resource that helps you understand, evaluate, and incorporate bonds into your portfolio, Bond Investing For Dummies has you covered.
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Great guide to Bonds!,
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First of all, this book does an incredibly job at introducing the vocabulary and jargon of the bond world. For a new investor, that’s probably the biggest hurdle. Par, muni, junk, yield, deferred, callability, on and on and on. At the very least this book provides the tools for understanding. Even if the concept is too difficult for someone to initially grasp, the vocabulary lesson permits a beginning. It would have been incredibly beneficial, however, if the entire set of vocabulary jargon were structured in an appendix.
The book concentrates not only on explanations and definitions, but also the rudimentary concepts behind each type of bond, the pros/cons, the timeframe to purchase, and even some suggestions with links to websites for further research. Probably the most beneficial is chapter 15, “Investing (Carefully) in Individual Bonds. Because the world of investing is so verbose and convoluted, many would elect to take the easy road or have someone do the work for them. Chapter 15 provides some guidance when dealing with a broker or an agent, for those who still don’t feel comfortable after digging into the entire book.
Being more familiar/comfortable with math than most, I’m a bit disappointed by the lack of formulas. Knowing how many items are calculated would have been beneficial. I understand, however, I am not the typical target audience.
Overall this is a fantastic resource for anyone looking at long-term investing and diversification in the bond market.
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|An excellent primer on bond investing with a couple very minor negatives.,
This is an excellent book. It’s well-written and presented in an easy-to-understand way with a lot of humor added to make reading it enjoyable. I learned a lot about bond investing from reading it and, in fact, after reading it, I ordered Russell’s ETF Investing For Dummies and his Index Fund Investing for Dummies. In short, I highly recommend the book for anyone needing good, basic information about bond investing.
That said, there are a couple things that I found disappointing about the book but I want to emphasize that those things are minor and the fact that this part of my review is longer shouldn’t lead someone to believe that I didn’t like the book. I did! It simply means it takes a bit longer to explain those minor negatives.
First, I was disappointed that Russell didn’t go into more detail about investing in bonds during these historic low interest rate times. The rates were low when wrote the book and he acknowledges that. But although he insists that everyone should have bonds in their portfolio, he really doesn’t address the issue of investing in bonds (or bond funds which he prefers for most people) when the interest rates really only have one way to go at this time and that’s up. And when that happens, bond holders are going to take a hit. These are very unusual times that require different strategies but Russell really didn’t deal with that to my satisfaction.
Russell mentions a study done that makes a very convincing argument that even older and retired investors should only have about 15% in bonds. Russell was impressed with that study and yet he still advises that investors should have about 30 to 50% of their portfolio in bonds, depending on their age. My father passed away two years ago when he was nearly 102 years old and I inherited 1/4 of his portfolio. It turns out that he had only a very small investment in bonds and he did very well over the years. If I remember correctly (I have reallocated the portfolio) he only had about 7% or so in bonds. And he made it through the 2007/2008 drop in very good condition and prospered. He had been investing since before the Great Depression and he was a conservative investor even though he clearly didn’t favor having a high percentage of his portfolio invested in bonds, which is consistent with the study Russell mentions. But he did have a high percentage of his investments in dividend stocks, including utilities, energy stocks, and a lot invested in a couple closed-end preferred funds, one of which has never missed a dividend payment since it’s inception in 1929. Those investments apparently took the place of a heavy investment in bonds for my father and it worked fine for him over many decades.
A couple more nit-picking things that I’m almost embarrassed to mention but I will. But don’t let these remarks turn you away from this very good book: Unfortunately, Russell had to make a few snide remarks about gun owners and people who own pickup trucks, etc. It was done to be funny but it was unnecessary. It also appears that Russell is very liberal because he mentions that any politician who refuses to vote to raise taxes when our national debt skyrockets (as it has) is insane. He never even considers the possibility of cutting spending in his little rant. I got the impression that Russell is a tax & spend liberal and he mentions his buddy, Bill Clinton. (Clinton actually did a pretty good job with the economy, though.) But these things were a hint to me that Russell may not share the same ideas I have when it comes to handling money. He mentions that, when he was a kid, his big hardship was that his 15-foot boat only had a 25 h.p. motor that made it slow getting around from his Long Island home. The horrors! (In fairness, he mentions this with a sense of humor but, even so, it reveals that he must have had a very sheltered childhood. No big deal, though, but it is consistent with some other things he mentions that made me think that we don’t share the same ideas, even when they apply to investing.)
One more tiny thing. Russell mentions in the book that he is a fee-only financial planner. That’s great! Fee-only planners are the only way to go, in my opinion, if you need a planner. Out of curiosity, I went to his website. What I found didn’t impress me very much. It seemed a bit “rinky-dinky,” in fact. Dig a little deeply into the site and you may see what I mean although you may not agree with my conclusion, of course. It paints a picture (by my interpretation) of a guy running a little business out of a small house (nothing wrong with that but it may indicate how successful he is as an investor – or it may just mean that he lives way within his means and I highly respect that if that’s the case. But it does raise a question about how good of an investor he is.) I went to a dentist who had rotten teeth once and that gave me pause about whether he was…
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|A dummy no longer — 🙂,
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I do have experience already in the bond arena, but I still found this book useful. It confirmed several ideas I had behind bond investing and it was a good refresher course for me. It covers private equity bonds as well as treasury and municipal bonds.
If you are new to bonds then get this book. It will help you learn a bit more; broaden your investing horizon; and help you diversify your portfolio.
And just remember you are in charge of your own financial destiny even if you have a financial planner. Be a smart client and know what your planner is talking about and ask questions. Find out if bond investments should be added to your portfolio. Maybe you already have them. Now you can find out what they are and why you have them! ^.^
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