Talk of The Villages Florida - View Single Post - I just don't get the wisdom of investing in bond funds.
Thread: I just don't get the wisdom of investing in bond funds.
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Old 11-11-2023, 09:35 AM
Caymus Caymus is offline
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Quote:
Originally Posted by collie1228 View Post
I have never understood bond funds. If I buy the bond and keep it to maturity, I get 100% the interest and all of my principal back at the back end (although rarely there could be a default). Bond funds don't do that.
Keep in mind that the returned principal would effectively be worth less if you bought the bond at 1% and it matures when rates are 5%.