Bonds - Fixed Income Investing

Bonds are popular among investors who invest for regular, predictable income. Because bond prices go down when interest rates go up, you should avoid buying bonds when you expect interest rates to rise. The best time to buy bonds occurs when you expect interest rates to come down.

If you are interested in investing in bonds, watch where interest rates are headed. If they appear to be on the rise, avoid bonds.

Another strategy is to buy bonds with staggered maturities; that is, bonds that mature in different years. This way, some of your money is locked up at today's interest rate, which is helpful should the interest rate fall. Should the interest rate go up, then you can take advantage of the higher interest rate when some short-term bonds mature. For most investors this is a safe strategy to follow.

Where to buy bonds

You can purchase bonds from your broker.

How to find out more

Most major newspapers carry bond quotations at least once a week. Major financial publications such as National Post and The Globe and Mail also publish them.

Money Digest carries articles on bonds and other fixed-income securities from time to time.

Bonds yielding more than 7.1%

                                      Current  Yield to
Bond              Maturity    Coupon  price *  maturity

Sask Wheat        July 18/07  6.60    42.00    31.13
Air Canada        Feb 2/04    6.75    90.00    16.73
Rogers Cantel     June 11/06  10.50   97.00    11.57
Rogers Cable      July 15/07  8.75    95.00    10.13
AGT Limited       Sept 22/25  8.80    93.61    9.49
Telus             June 1/06   7.50    94.50    9.39
Westcoast Energy  Dec 15/27   6.75    95.15    7.17
Union Gas         Nov 10/25   8.65    117.15   7.12

(Government of Canada bonds yield approximately one percentage point
less than comparable corporate and utility bonds listed above.)

Note: Prices as at mid-December, 2002. When a bond is trading at a
premium, always check its redemption features before investing.

* Multiply the price by 10 to get the actual price per bond. Thus, 98
means that the price of the hood is $980.