Thursday, February 19, 2015

3 reasons why you should invest in bonds

Bonds are long term debt instruments mostly issued by the government and corporate bodies. When they wish to borrow money from the investing public, usually on long term basis, they do so issuing or selling debts securities that are referred to as Bonds. 
Now, why Bonds;

1. Unlike investing in shares,  the investor is always aware of his returns before the investment.

2. An investor in bonds have a priority claim to earnings and assets over shareholders. In event of liquidation,  bondholders must be repaid before shareholders. 

3. Owning bonds is considered to be less risky than shares.

Wednesday, February 18, 2015

What you should know about Treasury Bills before you buy

1. Know that treasury bill is a short term investment product offered by the Central bank on behalf of the Government.
2. Know that an investor of T-bills lends his money to the government at a fixed rate for either 91, 182 or 364 days.
3. Know that when it matures,  the government will repay the amount borrowed plu the agreed interest rate.
4. Know that you can only purchase T-bills through a licensed bank.
5. Know that there's no limit as to how much one can buy. It's all about your pocket.
6. Know that, the investor pays nothing as transaction cost.
7. Know that you may take your interest / discount up front.
8. Know that you can roll-over the principal and take your interest at maturity.
9. Know that you can roll over both the principal and interest at maturity.
10. And finally know that you can contact @PEAGAMA before buying your treasury bill with any doubt you may have.

Keep investing.


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