Your Questions About Investing In Bonds

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Thomas asks…

Is it better to pay as much as we can when buying a house?

Me and my wife are thinking about buying a house in London…
We have more than 100k in the bank invested in Bonds and ISAs (from which we get roughly £4500 net a year)…
We are planning to buy a house for around £200k..
Is it better for us to use all our cash, or most of it (and lose out on the interest earned) just so we don’t need a big mortgage?
What would you do?
Thanks in advance for all the advices!

Justin answers:

Yes, the larger the deposit, the better, as interest is accumulated and calculated on the balance you owe, at the end of a period, whether it be monthly or yearly. So the lesser the amount, for them to calculate interest on, the better, cos then effectively you pay less of what you have not borrowed. Also, its best to take it over a shorter period in years, than the maximum period, as the shorter period means less interest, fees. Etc.

David asks…

what is the trade symbol of the government bonds themselves ?

I would like to invest in U.S.A government bonds directly (only govt bond index linked) and without involving securities that are indirectly related to government bonds but only just government directly.

When I were looking for government bonds, all I could find are other kinds of securities such as mutual funds which invest in government bonds and such as ETFs & ETNs which invest in government bonds, but not the government bonds themselves.
I am not interested in any other kinds of securities that are indirectly related to government bonds, but only in buying government bonds themselves.
The bottom line I wanna to know, is what is the trade symbol of the government bonds themselves ?

regards

“trade symbol” i mean Identification Number/Sequence Numberq/security number… ….
then, I would appreciate it if you could write for me Identification Number/Sequence Numberq/security number… ….

regards

Justin answers:

There are thousands of them. The ID number will depends on original date, maturity date, cpoupon, yield, amount ,, etc. Best is to contact the bond department of your broker to see which ones are specifically available that meet your criteria for maturity, coupon, yield, etc.

Mark asks…

How much interest on I bond accounts this November?

I have a few thousand invested in I bonds. Where do you think the intrest will be on I bonds next month? Should I buy more?

Justin answers:

4.25%

I would invest in CDs. The rates of return on I-bond will not out pace them over the next few years.

James asks…

How do you set up the inequalities etc for this problem?

A bank is attempting to determine where its assets should be invested during the current year. At present, $500,000 is available for investment in bonds, home loans, auto loans, and personal loans. The annual rates of return are:

Bonds=10%, Home Loans 16%
Auto Loans 13%, Personal Loans 20%.

Restrictions:
The amount invested in personal loans cannot exceed the amount invested in bonds.
The amount invested in home loans cannot exceed the amount invested in auto loans.
No more than 25% of the total amount invested in auto loans may be invested in personal loans.

Help the bank maximize the annual return on its investment portfolio by formulating the linear program.

Please use w,x,y,z for variables so I can follow along… Thank you for helping out.

Justin answers:

W = Bond Investment
x = Home Loan Investment
y = Auto Loan Investment
z = Personal Loan Investment

Eq.#1: 0.10w + 0.16x + 0.13y + 0.20z = 500000
Eq.#2: z <= w
Eq.#3: x <= y
Eq.#4: z <= 0.25y

Michael asks…

Can you please provide me good websites and tutorials to help start investing?

I’m referring to websites and links that provides tips on how to invest in stocks, bonds, etfs, etc.

I’m looking for information how to analyze a stock, bond, etc…,how to analyze a company, etc…

Justin answers:

Ask your question in google — there are many such sites that claim to help — mind the ones that want money up front.

Also, your public library has many books on the subject — ask a librarian to help you find some and start reading for free.

John asks…

How much does a guy like me need to worry about taxes when holding this fund outside of a tax advantaged acct?

I’m referring to Vanguard’s Wellesley Income Fund (VWINX). This balanced fund is about 2/3 invested in bonds.
I’m a simple cabbie in California and my income is less than $30K/annually. I have about $180K conservatively invested.
Thank you.
Yes! I have maxed out my tax advantaged accounts!
I’ve been maxing out the Roth IRA’S for years.

Justin answers:

Outside of a tax-advantaged account you’re going to pay taxes every year at your normal tax rate on the interest. It has a about a 3.5 percent yield. Its generally better to put income-producing investments into a tax-advantaged account.

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