FINANCIAL HOUSEKEEPING | Learn your fiscal personality
If you think you know the type of investor, saver and spender you are, try putting it to the test. Putnam Investments has a 15-question survey designed to determine your financial personality.
The survey takes less than two minutes to complete and offers information about your investing inclinations and suggestions on how to correct habits that may be holding you back from reaching your goals.
The survey is free, fun and worth a look. You can get to it by going online to to www.putnam.com/survey.
SHORT COURSE | Bond swaps
A bond swap is a transaction where an investor sells one bond issue and simultaneously buys another block with a similar market value. Swaps may seem like neutral or lateral moves, but they are done for several reasons:
In a maturity swap, investors are trying to stretch out maturities, dumping short-term bonds in exchange for longer-term securities, sometimes profiting because longer bonds tend to trade at lower prices.
Quality swaps seek to upgrade the safety and security of the portfolio.
Yield swaps are made in an effort to improve returns, trading lower-yielding bonds for ones with a bigger payout rate.
Tax swaps are made so the investor can create a tax-deductible loss in the sale, while keeping the portfolio allocation steady through the purchase of a substitute bond issue.
