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Higgins Capital Management, Inc.

What Is A Bond Ladder?

A bond ladder is a strategy involving the purchase of bonds that have staggering maturity dates. Instead of maturing all at once, the bonds mature in intervals. This may help a bondholder to be less susceptible to changes in interest rates.

Assume you set up a five-year bond ladder. You purchase five different bonds with maturity dates of one, two, three, four, and five years, respectively. When the first bond matures after one year, you would purchase a new five-year bond to keep the ladder intact.

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The information contained in this Higgins Capital communication is provided for information purposes and is not a solicitation or offer to buy or sell any securities or related financial instruments in any jurisdiction. Past performance does not guarantee future results.

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