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Bonds Beat The Returns vs Risk of Most Investments

There are many investment options, but as many of their returns struggle against inflation, it’s a tough choice. So if you’re looking for a safety focused investment, that offers higher returns, Australian Bonds might be the right choice. Bonds give you:

  • Flexible length and your investment is not locked in for the full term
  • A defensive investment for any portfolio
  • Your money is available before the end of the term with no penalties to get your own money back
  • Returns a regular, reliable steady income rather than a lump sum return
  • There is risk. You receive the increased returns because you accept the risk of losing some or all of your investment.
  • The possibility of a flexible rate, fixed to interest rates or the inflation rate. This means that if rates go up, so do your returns!

Direct Bond Access now in Australia

Bonds were used exclusively by banks for years. But for the first time in Australia, Bonds are now directly available to retail customers through the Australian Bond Exchange for as little as $10,000 and this offers a powerful replacement for other investments.
Bonds offer you:

  • Interest at regular intervals, not just the end of the term.
  • Buy extra during the life of the bond (subject to availability).
  • Withdraw some or all of your money at any time with no penalties, your money is not locked up for the entire term.
  • The returns can be flexible, which means if the interest rate goes up, you earn more money over the long term!

The Limits of Locked in Investments

For example, you might have $100,000 and take out a 12 month investment at a 4.6% interest rate. After 3 months, the rates rise up to 5.1%. But that’s for new customers only, you can’t change and get the better rate, or roll your current investment into the new one. Compare that with bonds: You invest your $100,000 in corporate bond at a floating rate of 6.75%. If after 3 months rates rise by the same amount to 7.25%, your bonds now start paying 7.25% and you don’t have to do a thing!

If you’ve been following the market, you’ll see that no one knows what’s happening. And while no one can know for sure what’s going to happen, you can prepare and survive – even THRIVE – in the coming market.

Direct access to Australian Bonds through the Australian Bond Exchange can now offer you better rates and better options. If you’d like to know more you can Contact Us, or enter your details below and we’ll contact you.