Many elect to do business with fixed income brokers and dealers. Fixed income is considered safe because it is backed by either the U.S., state or city government. However, you also can invest in corporate bonds.
Fixed income securities, such as municipal and treasury bonds, play important roles in both domestic and foreign economies. If you invest in the right securities, you can rely on consistent income. Consider the following income securities you can invest in with fixed income brokers and dealers:
1. Register with a fixed income brokerage firm that specializes in treasury securities.
2. Use municipal bond dealers that focus on municipal bonds.
3. Employ fixed income brokers and dealers to invest in corporate bonds.
Sign up with a fixed income brokerage firm that focuses on treasury securitiesAre you interested in fixed income, but want to help your federal government pay off its debt? Consider investing in treasury securities. These securities include U.S. savings bonds and notes. You can count on receiving interest and principal payments on time. You can buy and trade these securities through fixed income brokers and dealers.
Employ municipal bond dealers that specialize in municipal bondsMunicipal bonds are essential for financing local governments' projects. You'll be buying municipal bonds so that your local governments can fund projects, including school construction, bridges, hospitals and roads. One of the reasons why municipal bonds dealers are successful in buying and selling bonds is that these securities tend to be tax-free. However, you'll want to ask your municipal bond dealer about the tax risks involving these bonds.
Invest in corporate bonds with fixed income brokers and dealersLike governments, corporations sell bonds to finance their operations. Unlike government bonds, corporate bonds can be risky. These bonds are graded, based on how financially strong the company is. Therefore, you'll definitely want to seek advice from your fixed income dealer.
- Make sure your fixed income broker diversifies your portfolio. In other words, have a balance of treasury notes, CDs (certificate of deposits) and bonds.