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How To Buy Bonds: A Step-by-Step Guide
An inverted curve shows that the bond market is under stress because it essentially means that investors are being paid more for taking less risk. Inverted curves are not usually very dramatic looking, but they can be. If the rating is low—”below investment grade”—the bond may have a high yield but it will also have a risk level more like a stock.
On the other hand, if the bond’s rating is very high, you can be relatively certain you’ll receive the promised payments. Because bonds with longer […]