Episode from the podcastInvestED: The Rule #1 Investing Podcast

Bonds vs. Stock Investing

Released Tuesday, 13th April 2021
Good episode? Give it some love!
According to Phil and other value investors, investing should always essentially involve the same principles — even for non-stock investments like bonds. Putting your money where your values are, buying investments at a discount, and being able to move through different types of assets fluidly. 

For example, bonds and securities are other types of low-risk investments that investors purchase. However, their potential for returns is much lower as well. A bond might only make you a 3% return on your money over multiple years. This means that when you take your money out of the bond, you’ll have less buying power than when you put it in, because the rate of growth didn’t keep up with the price of inflation. 

Bonds can be purchased from the US government, state and city governments, or from individual companies. Mortgage-backed securities are a type of bond typically issued by an agency of the U.S. government, but can also be issued by private firms. 

When you purchase a bond, you are essentially loaning money to either a company or the government. For U.S. investors, this is typically the U.S. government, though you can buy foreign bonds as well. The government or company selling you the bond will then pay you interest on the “loan” over the duration of the bond’s life cycle.

Corporate bonds are slightly riskier than government bonds because there’s more risk of a corporation defaulting on the loan. Unlike when you invest in a corporation by purchasing its stock, purchasing a corporate bond doesn’t give you any ownership of that company.

In today’s podcast, Phil and Danielle discuss bonds, and why the best investments to make for yourself depend on your risk tolerance, level of understanding of certain markets, timeline, and reason for investing. 

Learn more about your different investment options with this Complete Guide to Investing for Beginners in 2021: https://bit.ly/3dYlBVI
Learn more about your ad choices. Visit megaphone.fm/adchoices

Episode Reviews

This episode hasn't been reviewed yet. You can add a review to show others what you thought.

This podcast, its content, and its artwork are not owned by, affiliated with, or endorsed by Podchaser.
Rate Episode

Share This Episode

Recommendation sent

Join Podchaser to...

  • Rate podcasts and episodes
  • Follow podcasts and creators
  • Create podcast and episode lists
  • & much more

Moderator Stats

ID
89195734
Visibility
visible
Podcast ID
2048

Episode Details

Length
40m 26s
Explicit
No
Episode Type
Full

Episode Tags

Do you host or manage this podcast?
Claim and edit this page to your liking.