For example, JP Morgan (JPM) or Bank of America (BAC) took in Spanish bonds as collateral that MF Global had just purchased and made a loan that matured concurrently with the bond maturity date.
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To be eligible for inclusion in the ETF, RMB Bonds must have an amount outstanding of greater than or equal to 750 million RMB and a minimum of six months remaining to bond maturity.
This is not a problem if you hold a bond to maturity (unless you recently bought a newly issued long-term bond), but it will adversely impact bond fund prices.
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However, this rate really does not matter if you hold the bond to maturity.
It is a measure of the total cash flows you will receive by holding the bond to maturity.
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In the private sector, companies' long-term bonds can be called in 5 years or 10 years after issuance, even if the bond's maturity is, say, 25 years.
They have been trying to boost their performance by shortening the duration (a measure that takes into account not just a bond's maturity but the interest it pays) of their portfolios.
However, as the bond moves closer and closer to maturity the total amount of interest that the bond will pay during its remaining lifetime is also moving closer and closer to zero.
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If you bought that Singapore bond, holding it to maturity might be a bad idea.
In 2010, iShares broke new ground when it rolled out six defined-maturity municipal-bond ETFs.
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At maturity if the bond paid in full as planned then using extreme leverage the return potential quickly gets into triple digits.
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This with a bond not of 30 year maturity, but infinite maturity!
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However, holding to maturity may be difficult, as bond investors discovered in the late 1930s and 1940s, once stocks begin producing 10% to 25% in some years, while the 20-year corporate bond will continue to pay only 4.5% or whatever annually to maturity (and meanwhile may be significantly underwater until maturity due to rising interest rates).
He recommends investors look at long-term bonds with 10 years or more between the bond's call date and maturity date.
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Like a bond, convertibles usually have a maturity date and pay a regular coupon, which should appeal to income-minded investors.
In bond-market lingo, the bond now has a "yield to maturity" of 2%.
All else being equal, as a bond moves closer and closer to its maturity date, its yield moves closer and closer to zero.
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It measures what the return on a bond is if it is held to maturity and all coupons are reinvested at the YTM rate.
Proceeds from a bond will need to be reinvested at maturity.
If not, remember that the bond you purchase should pay par at maturity, so if nothing changes with the company and you intend to hold the paper until it matures, you should be fine.
This leads me to the other advantage of bonds over bond funds: you can pick the maturity date and know with a high degree of certainty when you are going to get your money back.
The Vanguard Total Bond Market Index Fund has a yield to maturity of 1.6%, scarcely enough to keep up with inflation.
One, the yield to the worst call date is much better than yield to maturity of a non-callable bond (aka, bullet bond).
In these four periods of rising rates, managers had the acumen to navigate troubled waters by various techniques of managing bond types, sector allocation, duration, maturity, credit quality, country, and currency.
Rates are very low right now, but there is an interesting facet to EE bonds: the Treasury guarantees the bond will double in value if held to maturity, which is 20 years.
The same phenomenon can be observed in the index-linked government-bond market, where both interest payments and the maturity value are pegged to inflation.
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While most Italian households typically hold government paper to maturity, they could suffer hefty losses if bond prices continue to fall, as they have in recent months.
Although new efforts are underway in Western capitals to make bonds more readily rescheduable -- by such methods as a dramatic reduction in the percentage of bond holders who must agree to a change in the maturity structure -- it may be too late for Russia.
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