How exactly does buying/selling bonds work? and Jim Bond, Kinetic Sculptor - Drawing Workshops (15 of 21)

How exactly does buying/selling bonds work?

Can someone please elaborate on this? I need clarification on this. I am a Finance major. I understand that bond prices move in the inverse direction of interest rates however, what confuses me is how buying and selling bonds works. Because if bonds are a fixed interest rate and a guaranteed amount of money at a certain date then how can you make money off of them and so forth?


Bond best answer:

Answer by modano_man
Companies/Government must choose to issue the bonds at a predetermined interest rate. This will usually depend on the current inflation rate. You make money on the difference between the interest rate of the bond and the inflation rate. If inflation increases the gap closes. At the same time the present value of the bond will change as it matures.

Bond

Jim Bond, Kinetic Sculptor - Drawing Workshops (15 of 21)


Image by Keith Bloomfield
Images from the Jim Bond, Kinetic Sculptor - Drawing Workshops. This workshop took place on 9th March 2011 in the Community Art Space in the Queen's Square Shopping Centre.

Artist and kinetic sculptor Jim Bond brought his incredible drawing machines to West Bromwich for a one day workshop where members of the public were able to create unique pieces of art.

www.jimbond.co.uk

The Sandwell Arts in Queen's Square project has been set up to support economic growth and aims to attract new customers and business to Queen's Square Shopping Centre while promoting local artists and encouraging everyone to get involved in the arts.

Keep an eye out for the changing displays in the empty shop windows from local artists and community groups and get involved in some of the free arts activities organised in Shopping Centre.

Join the Sandwell Arts Facebook page - www.facebook.com/sandwellarts

---

Orignal From: How exactly does buying/selling bonds work? and Jim Bond, Kinetic Sculptor - Drawing Workshops (15 of 21)