Presentation by

Vasuki
Veerendragouda
Vijay patil
Vani
 There are two types
• 1) Active bond management strategies
• 2) Passive bond management strategies
• Bond investors may adopt passive or
active approaches to the management of their
portfolios. The passive approach is usually
identified with a buy-and-hold strategy. Active
bond mgt involves switching and swapping
bonds as circumstances change in the markets
for fixed-income securities.
 Buy-and –hold strategy
• A buy-and-hold strategy essentially means purchasing
and holding a security to maturity or redemption (eg:by
the issuer via a call provision) and then reinvesting cash
proceeds in similar securities
•
• By holding securities to maturity, any capital change
resulting from interest change is neutralised or
ignored( by holding to maturity the par amount of the
bond will be received)
•
• The passive or buy-and-hold strategy is used primarily
by income-maximizing investors like reired
persons,endowment funds, bond mutual funds and
insurance companies.
 Bond ladder strategy
• Building a bond ladder means buying
bonds scheduled to come due at several
different dates in the future, rather than all
in the same year

• Bond laddering is a smart-investment

concept for conservative individuals who
are unsure of interest rate movement and
are afraid to bet on any one forecast.