Whether one is living in difficult or robust economic times, it is always important to have an investment strategy that includes relatively safe investments. One form of investment is known as Fixed Income Investments.
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When to Use Fixed Income
Investments? Ask Ebele
Whether one is living in difficult or robust economic times, it is always important to have an
investment strategy that includes relatively safe investments. One form of investment is
known as Fixed Income Investments.
Fixed income investment refers to any type of investment that generates an average return.
Investors loan their money to a government body, corporation, or financial institution and
receive interest on a regular basis. Although the rate of return may not be high, there is
comfort knowing the risk is minimal. If a person is seeking to invest their money where there
is not a high risk, fixed income investments are usually the solution.
The term fixed-income investment include such investments as bank notes, mutual funds,
mortgage backed securities, retirement investments such as GICs, T-Bills, as well as
government and corporate bonds, and other forms of securities. While the principal and
return are not fail-safe, these fixed-income funds offer the chance for a higher return. They
are popular for those planning on retiring in the near future.
GICs are a popular choice as a fixed income investment. The interest and principal are
insured to a certain degree so your money is for the most part protected. Fixed-income mutual
funds are a good choice for wary investors as they provide the opportunity to predict income
over a set period of time. This is handy for budgeting purposes, so people can plan for
Many prudent investors acquire bonds as a fixed income investment. They generally pay out
twice a year or on a monthly basis. Bonds are a tax-free investment income. Such bonds can
be federal, state, or local municipality bonds.
Certificates of Deposit allow people to earn interest on their investment without any real risk
of loss. It is much like putting money in an insured bank investment for a fixed period of
time. It will earn a preset interest rate for a fixed time period. After the time expires, the
certificate matures and the investor can cash in the certificate. They will receive their initial
investment plus any interest earned.
Savings Bonds pay a fixed interest rate that is delayed until the bond is redeemed or for 30
years. The rate is based on the interest rate at the time of purchase. The interest paid is
adjusted for inflation.
If you are about to retire and are in need of an investment with low risk, fixed income
solutions can be the right choice. Investment portfolios will benefit by having a safe and
secure stock. By combining investments that are affected differently by economic events,
investment risk is reduced. These investments are often chosen during periods of market
instability. Fixed investments can fluctuate with market conditions. If you have to sell them
prior to maturity, you will usually receive a penalty fee.
Ebele Kemery says that Fixed Income Investments are a sound choice for cautious investors
and those seeking a safe investment for retirement. Most fixed-income investments also
provide a foreseeable flow of income. This can be an advantage for those on a pension or
Ms. Ebele Kemery is a member of the Global Fixed Income, Currency & Commodities
(GFICC) Group. Based in New York, Ebele is the head of Energy Investing within the
Ebele is consistently promoted; recognized for development and leadership strengths and
Strong analytical approach; full-tuition scholar from top-tier university possessing a
Bachelors in Engineering in Electrical Engineering.
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