A fixed income security is an investment that pays regular income in the form of a coupon payment, interest payment or preferred dividend.

Fixed Income Trading The markets for fixed income securities are much larger, by volume, than that of equity securities (stocks). Prices of fixed income investments can move based on …

A collateralized mortgage obligation (CMO) is a fixed income security that uses mortgage-backed securities as collateral.

Many balanced funds invest in equity and fixed-income mutual funds themselves, giving greater exposure to a larger number of securities for its investors. Money Market Funds Money market …

A collateralized debt obligation (CDO) is a security that repackages individual fixed-income assets into a product that can be chopped into pieces and then sold on the secondary market. They …

Because bonds traditionally pay the investor a fixed interest rate periodically, they are also known as fixed-income securities. Unlike stocks, bonds don’t make the investor an owner of the bond …

An equity linked note (or ELN) is a debt instrument that varies from a standard fixed-income security in that the coupon is built on the return of a single stock, basket of stocks, or equity …

It also generates income (from coupon payments on the fixed-income securities and possibly dividends) as well as the opportunity for growth (from the capital gains in the equities). Why …

Conservative Risk Tolerance A conservative investor will often have a very low risk tolerance, and will build an investment portfolio that holds a majority of its assets in fixed-income securities …

Fortunately, in periods of rising interest rates, STRIPS prices tend to fall less than other bonds do. Thus, with their virtually guaranteed income stream, STRIPS make excellent defensive plays …