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Investors can never be completely certain as to where bond yields are headed. To deal with this uncertainty, many bond investors use a technique called laddering to help balance risk and return. What Is a Bond Ladder? To build a laddered portfolio, investors purchase bonds with different maturities spread out over their investment time frame. By staggering maturities, investors may be able to reduce the impact that interest rate changes can have on their portfolio, as when interest rates rise, bond prices fall. Additionally, spreading out maturity dates can help investors stay disciplined and prevent them from trying to time the market. For example, you could purchase bonds that mature each year during a span of 10 years. By coupling this with a rollover strategy, when the first bond matures, you would reinvest the proceeds in a new bond that matures in 10 years. As each bond matures, you would continue this process. Aer 10 years, you would own all 10-year bonds, with one maturing every year. How Does a Bond Laddering Strategy Work? While a laddering strategy does not ensure a profit or protect against a loss, employing a bond laddering strategy in your portfolio can help protect against interest rate fluctuations. If interest rates rise, you'll know that you will soon have money available from a maturing bond that you can use to purchase a new, higher-yielding bond. If interest rates fall, then you have at least managed to lock in higher rates for a portion of your portfolio. is strategy can also be used with CDs, and certain fixed income mutual funds, and exchange-traded funds (ETFs). For more information on the laddering technique and to determine if this strategy is right for you, contact Sharon Nalivka Hancock at Stifel's Great Falls office. FACTS ON FINANCE PROVIDED BY SHARON HANCOCK Article provided by Stifel, Nicolaus & Company, Incorporated, member SIPC and New York Stock Exchange, which can be reached in Great Falls at (406) 761-3500. Stifel does not provide legal or tax advice. You should discuss your particular situation with your legal and tax advisors. BOND LADDERING: How to Balance Risk and Return in Your Portfolio Stifel, Nicolaus & Company, Incorporated Member SIPC & NYSE | (406) 761-3500 | (800) 333-6017 300 Park Drive South, Suite 101 Great Falls, Montana 59405 For more than 130 years, our primary focus has been understanding our clients' goals and using all of our resources to strive to fulfill their long-term objectives. Your road to tomorrow begins today! WHAT LIES ON YOUR HORIZON? (406) 761-4900 3900 10TH AVE. SOUTH GREAT FALLS, MT 59405 Dedicated trained technicians Preferred insurance provider We use the latest technology We handle the entire claims process Over 66 years serving Central Montana CITY MOTOR COLLISION CENTER SiG MT 131 S MT

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