There are many different types of bonds trades, which range from passive to active. Both passive and active strategies can be used for trading bonds. When investing in a bond, you can either buy and hold it until maturity or sell it to another investor when the value drops. This strategy can be very profitable for some investors, and can be a great way to protect your portfolio from price fluctuation. This article will discuss each type of trade, and the best way to approach them.
The price of a bond is expressed in percentage of its nominal value, with 100% representing par. A bond can have a price that is above or below par, or can carry accrued interest since the last coupon date. In either case, the market price is called the “full” or “dirty” price. The former refers to the price of a bond after the accrued interest is calculated. This is a common strategy for the average investor.
The price of a bond determines its yield. This means that it is important to shop around for the best price. Buying a bond online is easy, but it is also important to shop around. The lowest price does not necessarily mean the best value. This is because the cost of a bond often consists of many different cost components, making it difficult to understand all the different parts of the price. To understand all the costs associated with buying and selling a bond, you should consider the terms and conditions of the brokerage you choose.