KEY POINTS: Premium Bonds: Hold value better Partial return of premium with interest payments Can be sold at a profit More likely to be called before the maturity date Reinvestment risk in low interest rate scenario Discount Bonds Preferred by retail clients, along with par bonds. Lower cash flow, but interest payments may be only interest due. [...]
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Why Some Moral Obligation Bonds are Like Farm Raised Atlantic Salmon
The word moral means the rules of right conduct. Municipalities issue moral obligation bonds, which have a specific definition in the law. According to Black’s Law Dictionary, a moral obligation is “a duty which is valid and binding in conscience and according to natural justice, but it not recognized by the law…”[i] Many people purchase [...]
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Like Water, Like Cash Flow
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Pricing TIPS is a Chess Game
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Pay premium price for high coupon high quality bonds?
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Why Some Moral Obligation Bonds are Like Farm Raised Atlantic Salmon
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Premium or Discount Bonds? That is the Question
