Just as governments issue bonds to finance public spending, so companies issue bonds to raise money to invest in their business.

For companies, corporate bonds provide an alternative to raising money by issuing shares. For private investors, corporate bonds offer the opportunity to buy a fixed income in exchange for an investment of capital.

All types of corporate bonds share common traits that you need to understand before you consider an investment.

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Honestly, I despair. The day before the UK Government unveils a second banking rescue package worth hundreds of billions of pounds and RBS (once one of the world’s largest banks) falls 67% to become a penny stock, the Conservative party apparatus circulates a press release concerning… Value Added Tax in a Government gift shop.

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Important: What follows is not a recommendation to buy or sell RIT Capital Partners. I’m just a private investor, storing and sharing notes. Read my disclaimer.

Name: RIT Capital Partners Ticker: RCP
Listed in: London (FTSE 250)
Business: Investment vehicles
More info: Digital Look / Google Finance
Official site: RIT Capital Partners

Some say it’s harder to keep hold of serious money than to acquire it. They tend to be very rich. The rest of us would dearly love to find out!

For preserving great wealth over the long-term, it’s hard to beat the Rothschilds. This banking dynasty started making money in the 18th Century:

• Nathan Mayer Rothschild helped finance the British Napoleonic War effort, sending bullion to the Duke of Wellington at the front
• The Rothchilds backed the industrial revolution in Europe, financed railways worldwide, and put together funding for huge projects like the Suez canal
• The family business continues today, with various wings operating investment and finance firms including: N M Rothschild & Sons, Concordia BV, LCF Rothschild Group, Atticus Capital LP and RIT Capital Partners

Do what the rich do

You can’t argue with a 200-year history of making money. I don’t understand why someone would back the ‘black box’ investing of a newbie billionaire like Bernie Madoff, the alleged Ponzi fraudster, who apparently discovered the secret of making steady 15% returns but wouldn’t tell anyone else.

When today’s fly-by-night financiers are long gone you can be sure the Rothschilds will still be in the game. While Rothschild conspiracy theories abound as a result of their success, I say good luck to them.

In fact, if you could only choose between reading Monevator or a blog written by Jacob Rothschild (aka the 4th Baron Rothschild) I’d recommend reading Rothschild. Forget Rich Dad, Poor Dad – his blog would be more like Gazillionaire Dad.

I can’t point you to Jacob Rothschild’s blog, but I can tell you how I invest some of my money right alongside his own.

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