DIG DEEPER
Books
Although there are innumerable books for retail investors about stocks and the stock market, a very limited number of books explain fixed income. The reason for this is unclear: One could surmise that stocks are sexier, have the potential for greater return, and play to the competitive nature of some investors. Though fixed income (including bonds) may be considered “boring,” it is an essential part of a well-balanced portfolio. Below are a few helpful books for learning more.
Step by Step Bond Investing: A Beginner’s Guide to the Best Investments and Safety in the Bond Market by Joseph Hogue. At just over 60 pages, this truly is a book for beginners. If you don’t have a lot of time and want to learn just a bit more about the bond market, this title fits the bill.
Investing in Bonds for Dummies by Russell Wild. Many of us are familiar with the Dummies books and know that they offer a great introduction to a range of topics. This volume helps you understand why bonds are such an important part of a portfolio. However, the author focuses mainly on bond funds, so this is not the best book for those who want to know more about investing directly in individual bonds.
The Bond Book, Third Edition: Everything Investors Need to Know About Treasuries, Municipals, GNMAs, Corporates, Zeros, Bond Funds, Money Market Funds, and More by Annette Thau. This book explains what bonds are, how to buy them, and how to make money from them. At almost 450 pages, it is a fairly dense. However, much of it is written in plain language and it will help you go deeper than the previous books mentioned.
The Strategic Bond Investor, Third Edition: Strategies and Tools to Unlock the Power of the Bond Market by Anthony Crescenzi. Considered a classic, The Strategic Bond Investor was recently updated and rereleased in 2021. However, this book is not for the beginner. It was written by an industry professional and is most appropriate for experienced investors or those in the finance industry.
Podcasts
Money for the Rest of Us, Episode 225: How to Invest in Bonds and Other Fixed-Income Securities In this episode, David walks you through what economic factors influence interest rates and how these factors may affect bonds and other investments. He also poses questions that help with the decision about buying and holding bonds.
Additional Resources
A BIT MORE ON BOND BASICS
This Fidelity one-page summary gives prevailing rates on US Treasuries and government-agency, corporate, and municipal bonds across a 3-month to 30-year time horizon. It is a fantastic resource that offers a snapshot of the bond markets all on one page.
This handy Value Line guide gives more information about fund classes. Use it to read about share classes that were not mentioned in Chapter 6.
This short piece from The Motley Fool gives more information about fund classes. It includes a brief video and creates fictitious Class A and Class C investments to compare.
INDIVIDUAL BONDS – MOVING BEYOND BASICS
The bond market is complicated. Many people choose to invest in them either with a financial advisor or through bond funds. Below are resources for those who want to better understand how these markets work and even explore buying and selling individual bonds on their own.
This Nerdwallet article provides insight into how to buy bonds. It explains where to buy bonds, what to look for, and whether it makes sense to integrate individual bonds into a portfolio.
This Schwab article describes the different types of municipal bonds and lays out the pros and cons of each.
The EMMA website is a great source of information for investors interested in researching, purchasing, or performing comparative analysis on individual municipal bonds.
The Climate Bonds Initiative is a resource for finding and researching individual bonds with an environmental focus. The site provides a wealth of information about environmental and green bonds and identifies new bond issuers as they enter the market.
Environmental Finance is another resource for those who want to go deeper to understand the individual green and sustainable bond markets.
Don’t Quit Your Day Job provides a vast array of calculators, including several focused on bonds. With them you can determine yields, durations, and other attributes of bonds. These tools may be valuable to explore possible investments in individual bonds.
Green and Sustainable Bonds
This World Bank piece tells the story behind green bonds. “Issued in November 2008, the World Bank’s first green bond created the blueprint for sustainable investing in the capital markets. Today, the green bond model is being applied to bonds that are raising financing for all 17 Sustainable Development Goals.” What started out as an opportunity for governments and large institutional investors is making its way to the rest of us – the retail investors. This site tells that tale.
BOND FUNDS – A BIT MORE DETAIL
This article by Investopedia offers a perspective on the strengths and weaknesses of bond funds and bond ETFs and provides guidance about choosing which investment might be more appropriate for you.
This Schwab article describes the attributes of bond ETFs and explains their levels of risk (including the important-to-know-about “tracking error” risk).
VALUES-ALIGNED BONDS AND BOND FUNDS
The Green Bond Principles can be downloaded from this site.
This Sustainable Investing piece gives insight into how to think about different funds, recognize the impact of different share classes, and better understand bond investing.
Schwab Socially Conscious Funds List. A comprehensive list of fixed income and public equities funds broken down by type. Among public equities, the list includes funds of different market cap sizes, geographies, and value/growth, as well as target-risk and target-date options.
CHAPTER 6
Grasp the Potential of Bonds
DIG DEEPER
Books
Although there are innumerable books for retail investors about stocks and the stock market, a very limited number of books explain fixed income. The reason for this is unclear: One could surmise that stocks are sexier, have the potential for greater return, and play to the competitive nature of some investors. Though fixed income (including bonds) may be considered “boring,” it is an essential part of a well-balanced portfolio. Below are a few helpful books for learning more.
Step by Step Bond Investing: A Beginner’s Guide to the Best Investments and Safety in the Bond Market by Joseph Hogue. At just over 60 pages, this truly is a book for beginners. If you don’t have a lot of time and want to learn just a bit more about the bond market, this title fits the bill.
Investing in Bonds for Dummies by Russell Wild. Many of us are familiar with the Dummies books and know that they offer a great introduction to a range of topics. This volume helps you understand why bonds are such an important part of a portfolio. However, the author focuses mainly on bond funds, so this is not the best book for those who want to know more about investing directly in individual bonds.
The Bond Book, Third Edition: Everything Investors Need to Know About Treasuries, Municipals, GNMAs, Corporates, Zeros, Bond Funds, Money Market Funds, and More by Annette Thau. This book explains what bonds are, how to buy them, and how to make money from them. At almost 450 pages, it is a fairly dense. However, much of it is written in plain language and it will help you go deeper than the previous books mentioned.
The Strategic Bond Investor, Third Edition: Strategies and Tools to Unlock the Power of the Bond Market by Anthony Crescenzi. Considered a classic, The Strategic Bond Investor was recently updated and rereleased in 2021. However, this book is not for the beginner. It was written by an industry professional and is most appropriate for experienced investors or those in the finance industry.
Podcasts
Money for the Rest of Us, Episode 225: How to Invest in Bonds and Other Fixed-Income Securities In this episode, David walks you through what economic factors influence interest rates and how these factors may affect bonds and other investments. He also poses questions that help with the decision about buying and holding bonds.
Additional Resources
A BIT MORE ON BOND BASICS
This Fidelity one-page summary gives prevailing rates on US Treasuries and government-agency, corporate, and municipal bonds across a 3-month to 30-year time horizon. It is a fantastic resource that offers a snapshot of the bond markets all on one page.
This handy Value Line guide gives more information about fund classes. Use it to read about share classes that were not mentioned in Chapter 6.
This short piece from The Motley Fool gives more information about fund classes. It includes a brief video and creates fictitious Class A and Class C investments to compare.
INDIVIDUAL BONDS – MOVING BEYOND BASICS
The bond market is complicated. Many people choose to invest in them either with a financial advisor or through bond funds. Below are resources for those who want to better understand how these markets work and even explore buying and selling individual bonds on their own.
This Nerdwallet article provides insight into how to buy bonds. It explains where to buy bonds, what to look for, and whether it makes sense to integrate individual bonds into a portfolio.
This Schwab article describes the different types of municipal bonds and lays out the pros and cons of each.
The EMMA website is a great source of information for investors interested in researching, purchasing, or performing comparative analysis on individual municipal bonds.
The Climate Bonds Initiative is a resource for finding and researching individual bonds with an environmental focus. The site provides a wealth of information about environmental and green bonds and identifies new bond issuers as they enter the market.
Environmental Finance is another resource for those who want to go deeper to understand the individual green and sustainable bond markets.
Don’t Quit Your Day Job provides a vast array of calculators, including several focused on bonds. With them you can determine yields, durations, and other attributes of bonds. These tools may be valuable to explore possible investments in individual bonds.
Green and Sustainable Bonds
This World Bank piece tells the story behind green bonds. “Issued in November 2008, the World Bank’s first green bond created the blueprint for sustainable investing in the capital markets. Today, the green bond model is being applied to bonds that are raising financing for all 17 Sustainable Development Goals.” What started out as an opportunity for governments and large institutional investors is making its way to the rest of us – the retail investors. This site tells that tale.
BOND FUNDS – A BIT MORE DETAIL
This article by Investopedia offers a perspective on the strengths and weaknesses of bond funds and bond ETFs and provides guidance about choosing which investment might be more appropriate for you.
This Schwab article describes the attributes of bond ETFs and explains their levels of risk (including the important-to-know-about “tracking error” risk).
VALUES-ALIGNED BONDS AND BOND FUNDS
The Green Bond Principles can be downloaded from this site.
This Sustainable Investing piece gives insight into how to think about different funds, recognize the impact of different share classes, and better understand bond investing.
Schwab Socially Conscious Funds List. A comprehensive list of fixed income and public equities funds broken down by type. Among public equities, the list includes funds of different market cap sizes, geographies, and value/growth, as well as target-risk and target-date options.