Bond Investing

A bid bond is a type of surety bond that guarantees a payout pending certain stipulations, such as the case of large-scale construction projects.

A bond covenant spells out the most important stipulations of a bond that could lead to default if not adhered to properly.

Here’s a closer look at baby bonds and why they’re such a popular investment for fixed-income investors seeking bond exposure. 

The coupon rate is a static variable in the bond market. It’s the interest paid by the bond. Most bonds pay out their coupons on a semi-annual basis.

Treasury Inflation-Protected Securities (TIPS) are issued by the U.S. Treasury where the principal value is adjusted according to the Consumer Price Index.

Treasury bonds are fixed-income securities issued by the U.S. Treasury with maturities ranging from 10 to 30 years and coupon payments.

A maturity date is the date on which the bond contract ends. On that date the borrower or issuer must pay the bondholder the face value of the bond.

The bond face value is the amount of money the bond will be worth at maturity. This is an important detail for investors to understand.