Bonds
Additional Resources
CIM Bond Strategy
Bonds can be an excellent investment for clients looking for stable and regular income from some of their money. The advantage that bonds have over stocks is lower price volatility, higher income payments, and a set maturity date where your invested principal is returned to you.
CIM employs a laddering strategy with bonds. With this method bond maturities are staggered every 2 years or so. Having shorter and longer-term maturities together has several advantages. If interest rates go down then you already have longer maturity bonds locked in for many years at higher rates. If interest rates go up then when your shorter-term bonds mature they can be reinvested at higher rates.
The table below illustrates a hypothetical bond ladder.
Click to enlarge.
