Bonds are the 2nd largest asset class globally after Real Estate. Historically, bonds were mostly available to professional investors and high-net-worth clients of investment banks. However, many retail brokers offer access to bonds now. With higher interest rates, bonds become more attractive to private investors.
Key metrics to analyze Bonds are:
- Face Value (aka Principal, Notional, Par Amount) - the amount you are paid at a bond’s Maturity
- Current Price - % of Face Value a bond is trading at (aka cent on $)
- Maturity - a date when a bond is repaid by an issuer
- Coupon - % of Face Value periodically paid by an issuer to bond holders
- YTM (Yield to Maturity) – it’s the IRR made by an investor if a bond is bought at the Current Price and held to Maturity (assuming all Coupons are reinvested at the same rate)
All of these metrics are automatically calculated in the 8FIGURES app for each bond in your portfolio.
Many brokers tend to show bond returns excluding coupons. This leads to gross returns underestimation since coupons contribute significantly to bond returns. Similar to stocks and ETFs, the 8FIGURES app automatically calculates bond returns (P&L, MOIC, IRR) including coupons and foreign currency conversions at historical exchange rates.
If your broker is not yet covered by our app, you can add your bond positions manually by searching the issuer name – it only takes a few minutes to add your portfolio data and enjoy automatic tracking going forward.
Track your bond portfolio like never before. Download the 8FIGURES app now.
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