greenspan, page-5

re: greenspan trading bonds
Trading Bonds is not too difficult, the difficult parts are:
1. Knowing which type suits your trading profile.
2. Making enough money for Bonds to be worthwhile.

From an Investor point of view, bonds are similar to Term Deposits. The simplest in Australia are Aussie Bonds (Australian Government Bonds) which return the worst rate because they are the most secure. There are many corporate bonds that you can invest in simliar to Equities (ANTG is the most talked about on Hot Copper), or more secure Corporate Bonds (such as TOLPA 7.75%) or less secure Coporate Bonds, reffered to as Junk Bonds (e.g. such as SGLG paying 12%).

The way most IM's make their money from is the change in Interest rates over time. If a Aussie Bond is paying (yielding) 6%, it is worth more then an Aussie Bond paying 5%. This interest rate differential over time is called the "Yield Curve", which is just how the Yields change over time graphed.

This is a quick intro but should get you thinking.

Cheers