Description
A Bond Ladder is a portfolio of fixed income securities with maturities staggered at regular intervals. By diversifying the maturities in your portfolio, you will have funds available for reinvestment on a consistent basis. The staggered maturities provide you with funds to invest if interest rates increase and avoid the penalty of having all of your money maturing in a low interest rate environment.
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Benefits
Bond Ladders position you to react to changes in interest rates.
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Features
You can minimize the effects of interest rate fluctuations by creating a Bond Ladder because it helps average the rate of return over time based on current interest rates, rather than committing to a one-time fixed return over the same period.
You receive semi-annual interest payments and get your principal payment back at maturity.
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Related Products/Services
Callable Bonds
Certificate of Deposit
Corporate Bonds
Convertible Bonds
General Obligation Bonds
High Yield Bonds
Revenue Bonds
Treasury STRIPS
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Bond Ladders