Bond Laddering Pros and Cons

A recent Morningstar article outlines the pros and cons of bond laddering—holding bonds of different maturities in a portfolio with the goal of creating predictable streams of cash flow. Pros: The current interest-rate environment “doesn’t much matter to you if you’ll get your bond’s face value back at maturity.” Investors don’t need to worry about incurring capital losses by selling their bonds for a discount in a rising-rate environment because they’ll holding the bond to… Read More