TYPES OF BOND FUNDS
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Almost every kind of bond can be found in one bond fund or
another. Bonds of each type are usually packaged together. For example, a fund
may include only corporate bonds or international bonds. One reason bonds of the
same type are packaged together is that they have similar objectives and
? Corporate bond funds are
made of bonds issued by companies in the private sector.
? Zero coupon bond funds are pools of zero
coupon bonds, which do not pay interest currently. Instead, they realize income
only when they mature.
? International bond funds invest in debt
securities of governments and corporations of other nations.
? Convertible securities funds invest in
debt securities that can be converted into stock.
Let's look at some more types of bond