Most major online brokers provide access to both individual corporate bonds and bond funds. Corporate Bonds: Here Are The Big Risks And Rewards
: These pool hundreds or thousands of bonds into one security. This is the easiest and most cost-effective way to diversify, especially for smaller accounts. Popular options include the Vanguard Total Corporate Bond ETF (VTC) or the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD). 2. Open and Fund a Brokerage Account
There are two primary ways for individual investors to gain exposure to corporate bonds:
: You lend money to a specific company. This offers predictable income and the return of your full principal if held to maturity, provided the company doesn't default. However, it requires more research and usually a higher minimum investment (often $1,000 to $5,000 per bond).
