If you thought the stock market was big, the bond market is even bigger! This is because the global exchanging of debt securities has a vast range of maturities and credit ratings.
And although many investors ‘ignore’ the bond market (they may not completely understand how it works, or are turned away because of the lower, fixed returns compared to the potential of stocks) it is crucial to understand its place in the investing scheme of things, and how you can benefit from it.
For example, while the Fed and most other central banks are increasing interest rates, the Central Bank of China recently cut its interest rate. Which means that not all economies agree on global interest rate decisions, and that could influence more diverse fixed income opportunities. And investors need greater choice and flexibility when determining whether to increase their portfolio allocations to bonds.
If you are considering bonds, Interactive Brokers is the place to head to, with the availability of over ONE MILLION bond types and options.
From corporate bonds, to US government securities, to non-US sovereign bonds, investors are able to find better-suited choices via the Bond Search Tool.
Investors can compare available options by maturity date, coupon, yield and rating, and even go as far as filtering by country of issuer, currency or industry.
This can make it easy to choose the right bond product, and allocate capital towards it.
The Bond Search Tool also allows an investor to compare yields against those of other brokers, to see if you are getting the lowest priced bonds, with the most transparent pricing.
And speaking of pricing, IBKR has no mark-ups or built-in spreads, and has low and transparent commissions.
Treasury bills, notes and bonds: 0.2 bps for the first USD$1 million of face value, plus 0.01 bps for face value above USD$1m.
Corporate bonds: 10 bps for the first USD$10,000 of face value, plus 2.5 bps for face value above USD$10,000.
Municipal bonds: 5 bps for the first USD$10,000 of face value, plus 1.25 bps for face value above USD$10,000 trade directly with other IBKR advisors and clients
You can even trade directly with other IBKR clients. It’s no wonder that Interactive Brokers was rated Best Online Broker for Bonds by Benzinga for a second consecutive year.
