The NASD has launched a new bond information Web
site that includes real-time prices on corporate and municipal bonds.
The Smart Bond Investing site is located at www.nasdbondinfo.com and is free to the public.
NASD says the creation of the site is partly due to
a lack of education among investors on bonds. Nearly two out of every
three corporate bond transactions now involve retail investors,
according to the NASD, adding that surveys indicate a lack of knowledge
among investors about bonds.
An NASD survey revealed that almost 40% of investors
own bonds or bond funds. The same survey showed that individual
investors know little about how the bond markets work. For example, the
survey indicated that only 40% of investors understand that bond prices
fall as interest rates rise. Another 34% either thought there is no fee
for buying or selling a bond, or they did not know whether they were
paying a fee for bond transactions.
"Bond markets, especially the corporate bond market, have been mostly a
mystery to individual retail investors, who are increasingly important
to those markets, and who find those markets increasingly important to
them," said John Gannon, NASD's Vice President for Investor Education.
"Individual investors who suffered major losses when the stock market
fell have moved more of their money into the bond markets. And baby
boomers are moving more and more of their assets from equities to bonds
as they get closer to retirement. There's no doubt that retail
investors need to be armed with more information and better education
about bonds and bond investing."
The Web site includes real-time transaction data, a
listing of the most actively traded corporate bonds and educational
information dealing with risk, how bonds are bought and sold and an
explanation of different types of bonds.
NASD Launches New Bond Information Web Site
May 31, 2005
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