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Bond Investments for the Retail Investor :
| Bond markets have been around for almost as long as equity markets. For most retail investors, bonds are seen as less exciting compared to equities, probably due to the relatively stable nature of bond investments. One can probably even argue that media coverage of stock markets is far more extensive than coverage of the bond markets. |
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Laredo, TX Bond Broker Phone Number And Address Directory
What is Bond Convexity ?
| Remember, as bond yields go higher, price goes lower. This relationship between price and yield has a convex structure in nature. The term used to describe this relationship is also known as convexity. Notice in the diagram below, we have drawn a tangent line a yield Y*. This tangent line is very similar to the concept of duration and represents the rate of change in price as interest rates change. When the steepness of this tangent line increases, so does the duration. |
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