Did you know there are 13 different kinds of Israeli government bonds you can buy for US dollars? The Tel Aviv stock exchange is wide open to foreign investors and offers great opportunities for the financially adept person to buy Israel bonds.
Government bonds from a country are literally assets that contract that government into giving you a certain amount of money every year for a few years! Even more exciting is that at the end of the bond’s lifespan the government will pay its value back to you. Learn more about the bond trade and investing in Israel by reading this handy guide.
How Government Bonds Work
Governments’ treasuries all over the world issue a number of bonds that locals and foreigners can buy. They get their name from the fact that they ‘bond’ the government into paying the bondholder in two different ways.
Firstly, the bond entitles the holder to periodic (usually annual) coupon payments. A coupon amount is a fixed amount of money the issuer pays the holder each period.
Secondly, bonds have a maturity date on which the government pays out the holder the bond’s ‘maturity value’. On that day you can redeem the bond for its original value. However, buying highly demanded bonds means you can also sell them at a higher price to a third party (if you wish to forego the coupon payments).
Why You Should Buy Israel Bonds
Israel is one of the best nations you can invest in today. The Israeli government has never defaulted on a debt payment. You’ll definitely be able to receive coupon payments and the eventual maturity payment (which is not always a guarantee for riskier nations).
In fact, Israel was able to maintain an A investment rating during the Covid economic crash. An economy that performs that well with as small a population as Israel has is a modern miracle.
Isreal is a world leader in tech startups and venture capitalism. Their economy continues to grow year over year, making their bonds highly sought-after investment assets.
As inflation rises, it may be time to invest some of your dollars in the form of government bonds abroad. Investing in Israel is one way you can protect your hard-earned money from devaluing.
Also, unlike companies, countries don’t really close down or go bankrupt. Buying government bonds from a country as resilient as Israel is about as safe an investment as you can make. Find out more by clicking this link.
Government Bonds Are Good for Your Portfolio
There are many investors who avoid government bonds like the plague, but this mindset can be very bad for your portfolio. If you’re currently living in a country with an unstable economy or an economy in recession, it would be a really good investment to bet on a country with a stable or growing economy. If you’re losing faith in your 401k, support Isreal and buy Israel bonds.
Do you want to learn about other great financial decisions you could be making? Check out the rest of Cullman Fair’s blogs to see what other opportunities there are.