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Posted: 9/16/2009 3:43:24 PM EDT
[#1]
Sounds familiar from college but that was a long time ago. But isn't a bond really just PAPER with a promise to pay? So it's useless anyway.
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Posted: 9/16/2009 3:49:23 PM EDT
[#2]
Yes I do!!
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Posted: 9/16/2009 3:50:10 PM EDT
[#3]
Quoted: Yes I do!! Good for you! Most only think equities.
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Posted: 9/16/2009 3:51:50 PM EDT
[#4]
another stellar ARFCOM GD investing thread.
Quoted:
Fixed income is not always a safe haven from the stock market. no shit. bonds and other debt security instruments are complements to equities, cash, real estate, and PM's. to the individual investor, bonds are an integral element of overall asset allocation strategy. Quoted:
Do you guys know how to calculate the present value of a bond? yes. but this is needed for what purpose in this thread? Quoted:
Do you know that the price of a bond is inverse to interest rates? really? you've been reading Wikipedia again, haven't you? Quoted:
Sounds familiar from college but that was a long time ago. now there is the response GD was expecting! Quoted:
But isn't a bond really just PAPER with a promise to pay? So it's useless anyway. your mortgage company vehemently disagrees. ar-jedi |
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Posted: 9/16/2009 3:53:50 PM EDT
[#5]
Quoted: Negative ghost rider.another stellar ARFCOM GD investing thread. Quoted: Fixed income is not always a safe haven from the stock market. no shit. bonds and other debt security instruments are complements to equities, cash, real estate, and PM's. to the individual investor, bonds are an integral element of overall asset allocation strategy. Quoted: Do you guys know how to calculate the present value of a bond? yes. but this is needed for what purpose in this thread? Quoted: Do you know that the price of a bond is inverse to interest rates? really? you've been reading Wikipedia again, haven't you? Quoted: Sounds familiar from college but that was a long time ago. now there is the response GD was expecting! Quoted: But isn't a bond really just PAPER with a promise to pay? So it's useless anyway. your mortgage company vehemently disagrees. ar-jedi Supported trading desks doing this stuff, I dumb it down for GD.
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Posted: 9/16/2009 3:56:36 PM EDT
[#6]
Quoted: "Promises of payment Sounds familiar from college but that was a long time ago. But isn't a bond really just PAPER with a promise to pay? So it's useless anyway. Are neither food nor raiment…” Thomas Love Peacock, 1825 It really doesn't add anything to the topic, but I really like that quote.  |
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Posted: 9/16/2009 4:06:38 PM EDT
[#7]
Of course; investing in bonds is far more complex than investing in equities.
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Posted: 9/16/2009 4:11:52 PM EDT
[#8]
Quoted:
Of course; investing in bonds is far more complex than investing in equities. this is way too broad of a brush. for example, demonstrate how investing in Treasury bonds and holding them to maturity is "far more complex" than investing in individual companies, or even a market index. ar-jedi |
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Posted: 9/16/2009 4:16:48 PM EDT
[#9]
Quoted:
Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi |
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Posted: 9/16/2009 4:18:29 PM EDT
[#10]
I know the stuff - did you have a question, or are you just checking the general knowledge of GD?
Speaking from experience, most people really don't understand bonds. Actually, many investment pros have only cursory understanding. (I was sitting on a bond-trading desk on Oct 19, 1987 - VP of Equities for a Muni house - what a day / week!). |
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Posted: 9/16/2009 4:21:44 PM EDT
[#11]
yes....it's a little fuzzy, but I've had a couple tonight.
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Posted: 9/16/2009 4:22:28 PM EDT
[#12]
I have never heard of "bond math"
What is it? |
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Posted: 9/16/2009 4:28:11 PM EDT
[#13]
Bond math=007
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Posted: 9/16/2009 4:32:15 PM EDT
[#14]
I ran a brokerage firm for 20 years I am familiar with all types of fixed income investments.
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Posted: 9/16/2009 4:41:25 PM EDT
[#15]
Buy bonds with a good rating and hold them to maturity. That's "fixed income". If you plan on trading them before they mature then you're taking your chances with the market - that's not fixed income. Might as well just buy a mutual fund if you're doing that.
Also, investing in municipal bonds gives a real rate advantage over taxable bonds. If you have a decent sized portfolio (i.e. number of different bonds, not necessarily $$) and stay away from risky stuff (like hospital bonds etc) you'll do fine. Much more conservative and stable than stock or mutual funds IMHO. The rate of return may be lower, but as the fable goes, the tortise wins over the hare in the long run. And you can sleep at night
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Posted: 9/16/2009 4:50:32 PM EDT
[#16]
Learn something new every day.
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Posted: 9/16/2009 4:53:37 PM EDT
[#17]
This thread is rather condescending. This is GD on a gun board. "Can you calculate YTM or immunize a bond portfolio from interest rate risk? No? RETARD!!!!"
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Posted: 9/17/2009 6:16:34 PM EDT
[#18]
Quoted:
This thread is rather condescending. This is GD on a gun board. "Can you calculate YTM or immunize a bond portfolio from interest rate risk? No? RETARD!!!!" actually i think the OP condescended *himself* while trying this approach... 
ar-jedi |
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Posted: 9/17/2009 6:20:40 PM EDT
[#19]
Quoted: Quoted: This thread is rather condescending. This is GD on a gun board. "Can you calculate YTM or immunize a bond portfolio from interest rate risk? No? RETARD!!!!" actually i think the OP condescended *himself* while trying this approach... ar-jedi Yes, poor form on my part, I admit. |
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Posted: 9/17/2009 6:22:02 PM EDT
[#20]
Quoted:
Yes, poor form on my part, I admit. well, i'll throw a couple of basis points your way for coming clean about it. 
ar-jedi |
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Posted: 9/17/2009 6:30:38 PM EDT
[#21]
Quoted:
Quoted:
Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi always diversify. 
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Posted: 9/17/2009 6:33:19 PM EDT
[#22]
Quoted: Quoted: Quoted: Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi always diversify. Yep, trading desks don't spread it around, it is all concentrated on what they do, and do very well. |
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Posted: 9/17/2009 6:34:47 PM EDT
[#23]
Not too good with the bond math but, pretty good with bond spelling:
O.r.a.n.g.e. C.o.u.n.t.y, C.a.l.i.f.o.r.n.i.a. L.e.h.m.a.n. B.r.o.t.h.e.r.s. 
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Posted: 9/17/2009 6:36:34 PM EDT
[#24]
0+0+7 = licensed to kill?
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Posted: 9/17/2009 6:37:49 PM EDT
[#25]
Quoted: I have never heard of "bond math" What is it? Simple answer: Math that tells you what a bond should be worth, given a certain set of conditions & a known 'quality' of the bond... |
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Posted: 9/17/2009 6:39:51 PM EDT
[#26]
Quoted:
question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi I've often said that myself....
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Posted: 9/17/2009 6:40:00 PM EDT
[#27]
You talking about things like
r=r*+IP+DRP+LP+MRP? Edit: Nevermind, that is not what you are asking. |
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Posted: 9/17/2009 6:40:31 PM EDT
[#28]
Quoted: Calculating the present value of the future income stream of coupon payments, principal repayment, taking into account current interest rates, bond interest rate, etc.Quoted: I have never heard of "bond math" What is it? Simple answer: Math that tells you what a bond should be worth, given a certain set of conditions & a known 'quality' of the bond... |
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Posted: 9/17/2009 6:49:30 PM EDT
[#29]
Quoted: This stuff will earn you a bond sales job at most.Quoted: Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi The trading is now done by quants with PHd's your finance degree could only dream of.
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Posted: 9/17/2009 6:51:40 PM EDT
[#30]
Hrm... "bond math"
Is that a prerequisite for Bailout 104? More seriously, I need fresh ice for my gold label "liquid asset" but my fundamentals aren't sound enough to make the walk. |
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Posted: 9/17/2009 6:51:55 PM EDT
[#31]
Quoted: Fixed income is not always a safe haven from the stock market. Do you guys know how to calculate the present value of a bond? Do you know that the price of a bond is inverse to interest rates? oh god you're bringing me back to those horrible days of studying for the series 7.... and yes, I know how to calculate the value of a bond based on the coupon rate and what it's trading at.... and yes I know that bonds have an inverse relationship to interest rates, interest rates go up, bond return go down, interest rates go down, bond returns go up.... in fact, I've been making a killing getting clients to rollover CD money from their bank into munis, why get like 1-2% return and pay taxes on CD money when you can get like 5-6% on a muni bond and it's tax free at the federal level, they'd have to have a CD yielding like 8% to compete with muni's right now. |
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Posted: 9/17/2009 6:55:03 PM EDT
[#32]
Quoted: Quoted: This stuff will earn you a bond sales job at most.Quoted: Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi The trading is now done by quants with PHd's your finance degree could only dream of. I remember reading a story a couple years ago about how firms were hiring people with PhD's in physics, math, or other analytic fields because of their quantitative background. Is that still true? |
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Posted: 9/17/2009 6:56:02 PM EDT
[#33]
If I think about it long enough, I could. But I got out of college with a finance degree two years ago and im so old now.
I never liked bonds. I still dont like bonds. If I invest in bonds it would be a bail bond and that would be for my wife or family
Id rather invest in property or a business than the bond market or stock market 
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Posted: 9/17/2009 6:59:01 PM EDT
[#34]
Quoted: Quoted: Quoted: This stuff will earn you a bond sales job at most.Quoted: Supported trading desks doing this stuff, I dumb it down for GD. cool, i didn't realize we had more pros on board. question for you... MPT suggests decoupling of economic business cycles of geographically disparate equity and bond markets. ergo, by spreading your asset allocation across various currencies, global equities, and uncorrelated bonds *should* reduce portfolio risk. however, recent events –– and negative returns everywhere –– have put a dent in this premise. what do you think of this going forward? ar-jedi The trading is now done by quants with PHd's your finance degree could only dream of. I remember reading a story a couple years ago about how firms were hiring people with PhD's in physics, math, or other analytic fields because of their quantitative background. Is that still true? they aren't getting hired in this economy.... My broke/dealer is cleaning house on under producing reps because their bill for SIPC insurance just went from 12K to 250K..... there's a lot of risk so the SIPC is bumping up it's premium a lot to cover it's ass, making b/d's trim off all the fat they can, |
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Posted: 9/17/2009 7:07:30 PM EDT
[#35]
Bond guys: do you think Barack Obama understands the bond market?
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Posted: 9/18/2009 1:48:45 AM EDT
[#36]
Quoted:
This stuff will earn you a bond sales job at most. The trading is now done by quants with PHd's your finance degree could only dream of. one of us has a pair of engineering degrees. and it's not you. ar-jedi |
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