Q. I understand when interest rates going up, bonds will suffer. But I plan to buy some individual bonds and hold them to maturity. Why I shouldn't do that?
A. There are plenty of reasons you shouldn't buy individual bonds on your own.
But first, let's see why it's tempting to buy individual bonds.
1. You get steady income.
2. Even with interest rates going up and bond yields down, if you hold your bonds till maturity, you will get your principal back - assume the issuer doesn't default.
Next, we will discuss the reasons against individual investors owning individual bonds.
A. There are plenty of reasons you shouldn't buy individual bonds on your own.
But first, let's see why it's tempting to buy individual bonds.
1. You get steady income.
2. Even with interest rates going up and bond yields down, if you hold your bonds till maturity, you will get your principal back - assume the issuer doesn't default.
Next, we will discuss the reasons against individual investors owning individual bonds.
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