When you are considering an investment, you want to know what rate of return an investment will give you. Some investments promise a fixed cost and a fixed payment at some point in the future. For example, a bond may cost $500 with the promise that $700 will be repaid 10 years in the future. Another bond may cost $600 with the promise that $900 will be repaid 15 years in the … [Read more...]
interest and shares : basic terms
Interest Rate Risk The possibility of a reduction in the value of a security, especially a bond, resulting from a rise in interest rates. This risk can be reduced by diversifying the durations of the fixed-income investments that are held at a given time.With the rise and fall of interest rates, announced by the Reserve Bank of India from time to time, the fortunes of the bond … [Read more...]