By Leanna Kelly The bond market tends to be relatively stable compared to the stock market. Nevertheless, there is a degree of volatility associated with bonds—especially as they change hands between investors. As you delve deeper into the bond market, it’s important to understand the difference between premium vs. discount bonds. Identifying them means capitalizing on some of this sparse volatility.
Bonds aren’t issued at a premium or discount. Instead, all new bonds enter the market as standard bonds. Their value—and their status as “premium” or “discount”—are the result of market factors and investor sentiment. It’s possible for investors to capitalize on both …read more