Fixed Income Investing

Fixed income investments have been a topic of broad interest, in particular for institutional investors such as insurance companies and pensions schemes. They were considered safe heavens in turbulent times by almost all other institutional and individual investors and are used for strategies such as portfolio immunization and asset liability matching (ALM). The latest crisis, however, revealed some of the weaknesses of fixed income instruments. They proved to be not as safe as originally thought with both credit and interest rate risks emerging. Consequently, fixed income investments have been in the spotlight once more.

This book presents all aspects pertaining to fixed income investments, starting from the basics-i. e. the types of bonds, their valuation, the interest rate term structure-then moving to fixed income portfolio management and the interest rate and credit derivatives and their relevant markets, funds, risks and risk management. Finally, the book addresses contemporary issues such as their behavior in times of crisis, their relation to debt, their coexistence with equity and the current regulatory environment. This book, providing a look at the broader environment of fixed income alongside the current market structure, will be of interest to students, academics, researchers and practitioners in fixed income and investing strategies.

1. Introduction. - 2. Bonds. - 3. Term Structure. - 4. Fixed Income Portfolio Management. - 5. Interest Rate Derivatives. - 6. Credit Derivatives. - 7. Bond Markets. - 8. Bond Funds. - 9. Risks and Risk Management. - 10. Bonds and Crises. - 11. Bonds and Debt. - 12. Bonds vs. Stocks. - 13. Hedging, Speculation and Arbitrage. - 14. Bonds and Regulation.