How Does Bond Laddering Work?



Investing in the stock market can be an exciting and profitable endeavor, but it can also be quite volatile.​ Many investors are looking for ways to add stability to their portfolios, and one strategy that has gained popularity is bond laddering.​ Bond laddering is a strategy that involves purchasing a series of bonds with staggered maturity dates, which can help reduce interest rate risk and provide a steady stream of income.

How Does Bond Laddering Work?​

The concept behind bond laddering is relatively simple. Instead of investing all of your money into one bond with a fixed maturity date, you divide your investment among a series of bonds with different maturity dates. For example, let’s say you have $10,000 to invest in bonds.​ Instead of investing the full amount into a single bond, you could divide it into ten equal parts and invest $1,000 in each bond.​

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