Select Page

Author: Geoffrey

Should I Invest in Stocks or Bonds?

When you have money that you are looking to invest, you are going to be asking yourself “How much should I invest in stock and bonds?” There are many different ways that someone can invest their money, and stocks and bonds are only two ways. Bonds and stocks are often considered together by investors due to many similarities. There are differences between the two that should be considered that depend upon your investment style and risk and profile. In a general sense, bonds are less volatile than stocks so it is often recommended that as you get closer to...

Read More

What is a Good Credit Rating?

In the world of finance, we hear the term “credit rating” in many different contexts. It’s important to know what credit rating are and how they apply to financial transactions between individuals, companies, and governments. A credit rating applies to any party that is seeking to borrow money. This can be a business, an individual, or even a government, although when applying to an individual, it is referred to as a credit score (derived from a credit report). Credit Score Individual credit scores are maintained by companies such as Equifax, Experian, and TransUnion. These evaluate the likelihood that an...

Read More

Why Was the U.S. Downgraded by Standard & Poor’s?

In 2011, Standard & Poor’s decided to downgrade the U.S. economy’s credit rating from AAA (prime investment grade) to one notch lower at AA+. The rationale given to this decision has to do with  the political atmosphere that was prevailing in Washington at the time. “We believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing containing the growth in public spending, especially in entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and...

Read More

How Risky Are Bonds? [6 Types of Risks]

Many people consider purchasing bonds because they think it is a relatively safe way to grow money. This is true, assuming that you buy safe bonds. How do you tell the difference between safe bonds and risky ones? The most important thing that differentiates bonds from each other are the types of risk that come with them. You have to remember that bonds are simply loans that have a unique payback method. For an introduction to bonds, check out this article, which precedes this one in this series on bonds. Since bonds are loans, we know that there is...

Read More

What are Bonds? [A Basic Introduction]

The bond market is one of the most central components of the US economy. It is an extremely common instrument of debt on both the primary and secondary markets and works to provide funding for public and private expenditures and projects. Bonds are exciting because they can be used to fund a vast array of interesting projects. The US government issues bonds along side corporations and municipalities, and the types of projects that they can be funding are as diverse as your imagination. In its simplest form, a bond is a loan that is made between a borrower and...

Read More