bond investment
bond investment

Bond Investment Will Get Big Profits In 7 Ways

There are several types that you can invest in, such as government, corporate, and retail bond investment. Whatever type you choose, the most important thing is to know the tips and tricks so that you can make big profits.

This investment is indeed low risk, even so you can still get high returns. Here are tips to follow to benefit from bond investing:

1. Set strategy before start bond investment

All types of investments must start from this point if you want to get high profits. You need to strategize well so that all things can be directed. Strategy can include goals, risks, and so on.

Through this strategy, you can determine the type, time period, risk management, coupon amount, tax, and so on. So if you want to buy government bond, you need to look at the prospects from the start before buying them.

Try to be wise in determining the amount of money to be invested. Consider diversifying investments to protect assets from investment failure.

2. Choose the right publisher

Bond investment can be issued by the government through Government Securities or companies authorized to issue them. Because there are so many who issue these debt securities, you have to be smart in choosing a publisher.

Make sure to choose a publisher that is registered and licensed by the OJK (Financial Services Authority). OJK oversees all forms of registered company activities so that their security is guaranteed. Also choose one that has high credibility and is trusted by the public.

3. Study the issuer of debt securities

After finding the publisher you want, it doesn’t mean you can immediately buy the type of debt you want. Study the publisher well in advance.

Especially if you choose a corporate publisher, not the government. So it is mandatory to study the publisher so as not to choose the wrong one. Know the company’s past performance, whether many have benefited or vice versa.

It’s not a loss if you don’t study the publisher, but it turns out that many previous investors have suffered losses. Not only track record, find out also about the board of directors, business profile, and the most important thing is to consider the risks.

If you feel safe with the profile of the bond investment issuer, then you can then buy the desired product.

4. View market conditions to bond investment

Interest rates on the secondary market are influenced by market sentiment. Therefore, it is very important to pay attention to market conditions when buying a product.

Some examples that affect interest rates are political conditions, Bank Indonesia (BI) interest rate policies, macroeconomic stability, and so on.

Understand and pay close attention to market conditions, including liquidity. Try to buy government bond investment or other products when market conditions are stable. In these conditions, the risk given is much smaller.

5. Choose the right time for the transaction

After seeing and observing market conditions, you will definitely find it easier to determine the right time to trade. In the secondary market, you can sell or buy products whenever you want.

You can set yourself when to make a purchase transaction and when to make a sale transaction for the product you currently have. The advantages of transactions in the secondary market are also the advantages of bond investments. Through this transaction, you will get a capital gain as an advantage.

For example, you buy a product in the primary or primary market for IDR 5 million at a price of 100%. You can later sell it to the secondary market at a higher price, say 105%. If you are able to take into account the time of buying and selling, then the profits obtained are very high.

If you don’t want to take risks and just want stable profits, you can keep the debt securities. You will benefit from coupons or interest every month or as agreed.

6. Follow the interest rate

One of the things you need to know before bond investment is that the price of debt securities is inversely proportional to the yield and the value of interest rates. The price can go up and down because it is influenced by various factors, such as interest rates.

It could be that when interest rates go up the price goes down, or vice versa. Therefore, buying and selling in the secondary market must be done at the right time. Moreover, changes in interest rates also affect yields, the price of debt securities decreases, the yields will increase.

7. Invest online for bond investment

The last tip to benefit from debt securities investment is to try investing online. In this digital age, there are many online applications that offer bond buying and selling services in the primary and secondary markets.

There are many advantages of trying to invest online, such as being easier, faster, and more economical. You can also order, pay, and create your own single investor identification, sell letters online, and check risk profiles. Everything can be done online.

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