A few months ago, nobody but a few U.S. Federal Reserve groupies had ever heard of quantitative easing. Yet today we’re told it’s the only thing that can save the financial system from meltdown. Indeed, the U.S. authorities have been moving towards quantitative easing for months, while the Bank of England has just got a [...]
The Investor
When you invest in a stock, you become a part-owner. When you instead invest in its corporate bonds, you’re instead a creditor.
Update: Voting is now closed, and we’re into round 3. Thanks everyone! Regular readers may recall that Monevator is in a financial blog competition, hosted by Free Money Finance. Well, we made it into round 2! Today I’m up in game 8, which you’ll find here. To vote, you read my post and my rival’s [...]
Vertical diversification is when your investment portfolio is spread across different types of assets. Cash, government bonds, corporate bonds, property and shares can each be expected to behave slightly differently and so produce different returns, as circumstances change. For instance, government bonds may soar when stock markets crash, because frightened investors sell their shares to [...]