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Questions to ask your broker before making a bond purchase deal

What is the interest rate or coupon rate

The stockbroker has already given us the answer to this and it is already very appealing

What is the bond price

The stated bond price refers to the cost of purchase or investment in the bond issue . This part of the question should also include elaboration of the yield to maturity period . The referred yield to maturity of a bond is the expected rate of

return until the bond matures

What is the bonds credit quality , its rating and is it insured

The credit rating of a bond is an initial indicator of the views of the market place considering the position of the issuer 's ability to repay interest and principle on a timely basis . It is very convenient to be aware of the type of bond you want to invest in , that is , an investment grade bond or high yield If the bond is insured , there is guarantee that the investors will be indemnified for their principal amount and interest should the Yubetchyu state default . Investors are also privileged to purchase insurance on purchases of secondary market bonds What is the tax status

Different types of bonds have different tax status . Interest income from the United States for example is exempted from state and also local taxes . The stock broker should expound on whether the Yubetchyu state is likely to drop state and local income...