Three questions to ask before you invest in fixed income

Investing well involves careful consideration of important factors and asking the right questions.

Investing is a buzz word which is not often not understand and applied well especially in the financial markets.

For people who are looking to invest in fixed income, critical analysis and asking the right questions will assist in minimising losses and increasing your chances of reaping returns on investment.

Investment analysis involves investment portfolio questions which concern fixed income exposure and dealing with different asset classes and by extension considering what type of securities to withhold.

Getting these dynamics right involves curious hindsight and foresight on business market events. Financial experts also recommend a keen attention to central bank decisions which can negatively or positively impact the financial markets.

Key questions to ask in this regard are:

How much credit risk do you have in the portfolio?

How much interest rate risk is in the portfolio?

Do you need liquidity?

Answers to the questions above will see you make wise investment decisions in fixed income.

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