Relationship Between Bond Price & Interest Rate Changes

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Relationship Between Bond Price & Interest Rate Changes – This is a place for the community to provide tips and advice on Relationship Between Bond Price & Interest Rate Changes. This topic was created by Elias Lepetu and the tips are provided by the community. The tips you add here can be your own or referred from another site. The best tips are then ranked at the top when up-voted by members of the community.

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Tip 1
Bond Basics: Yield, Price And Other Confusion | Investopedia More
Published: 9 years, 2 month(s) ago by Marc Wasserman | permalink
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Investopedia Explains: Bond yield, Bond price, yield to maturity, the link between price and yield and bond price in the market.
Tags: beginning investor,bonds

For further reading: http://www.investopedia.com/university/bonds/bonds3.asp ^[1]

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Tip 2
Why do interest rates tend to have an inverse relationship with bond prices? More
Published: 9 years, 2 month(s) ago by Kim Colacchio | permalink
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At first glance, the inverse relationship between interest rates and bond prices seems somewhat illogical, but upon closer examination, it makes sense. An easy way to grasp why bond prices move opposite to interest rates is to consider zero-coupon bonds, which don't pay coupons but derive their value from the difference between the purchase price and the par value paid at maturity.
Tags: bond,interest rate,coupon,zero-coupon bond,par value,maturity,bonds,interest rate policy,macroeconomics

For further reading: http://www.investopedia.com/ask/answers/04/031904.asp ^[2]

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Tip 3
Relationship between bond prices and interest rates More
Published: 9 years, 2 month(s) ago by Cong Nguyen | permalink
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Why bond prices move inversely to changes in interest rate

For further reading: https://www.khanacademy.org/economics-finance-domain/core-finance/stock-and-bonds/bonds-tutorial/v/relationship-between-bond-prices-and-interest-rates ^[3]

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Tip 4
Duration: Understanding the relationship between bond prices and interest rates - Fidelity More
Published: 9 years, 2 month(s) ago by Diana Keating | permalink
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Consider a bond investment's duration to understand the potential impact of interest rate fluctuations.
Tags: bond prices, bond rates, bond yields, bonds,seo-article
For further reading: https://www.fidelity.com/learning-center/investment-products/fixed-income-bonds/duration ^[4]

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Tip 5
Fidelity Learning Center: Bond Price Relations More
Published: 9 years, 2 month(s) ago by Myrella Coppus | permalink
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Learn how bond ratings work, Fidelity explains the fine points on reading the ratings.
Tags: bond ratings, how bonds work, reading bond ratings,seo-article
For further reading: https://www.fidelity.com/learning-center/investment-products/fixed-income-bonds/bond-price-relations ^[5]

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Tip 6
A Guide to the Relationship Between Bonds and Interest Rates More
Published: 9 years, 2 month(s) ago by Haroldine | permalink
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If you invest in bonds, know that bond prices and interest rates have an inverse relationship.
Tags: investing,money,Federal Reserve,bonds,retirement,mutual funds,interest rates,Kelly Campbell

For further reading: http://money.usnews.com/money/blogs/the-smarter-mutual-fund-investor/2014/05/29/a-guide-to-the-relationship-between-bonds-and-interest-rates ^[6]

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Tip 7
Why Rising Interest Rates Are Bad For Bonds And What You Can Do About It More
Published: 9 years, 2 month(s) ago by Stu Brown | permalink
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Why do bonds lose value when interest rates rise? What can you do to protect yourself against rising rates? Find out in,
Tags: bonds,Investing,Mutual Funds,Personal Finance,Retirement,bond coupon,bond interest,bond investments,bond market values,bond maturities,bond maturity,bond performance,bond values,fear and bonds,higher interest rates,individual bonds,interest rates,intermediate term bonds,long term bonds,rising interest rates,rising rates,short term bonds,us treasuries

For further reading: http://www.forbes.com/sites/mikepatton/2013/08/30/why-rising-interest-rates-are-bad-for-bonds-and-what-you-can-do-about-it/ ^[7]

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Category: Fun | 9 years, 2 month(s) ago

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Contributors

Stu Brown, Haroldine, Kim Colacchio, Marc Wasserman, Diana Keating, Myrella Coppus, Cong Nguyen

References & Citations

1. http://www.investopedia.com/university/bonds/bonds3.asp

2. http://www.investopedia.com/ask/answers/04/031904.asp

3. https://www.khanacademy.org/economics-finance-domain/core-finance/stock-and-bonds/bonds-tutorial/v/relationship-between-bond-prices-and-interest-rates

4. https://www.fidelity.com/learning-center/investment-products/fixed-income-bonds/duration

5. https://www.fidelity.com/learning-center/investment-products/fixed-income-bonds/bond-price-relations

6. http://money.usnews.com/money/blogs/the-smarter-mutual-fund-investor/2014/05/29/a-guide-to-the-relationship-between-bonds-and-interest-rates

7. http://www.forbes.com/sites/mikepatton/2013/08/30/why-rising-interest-rates-are-bad-for-bonds-and-what-you-can-do-about-it/