Corporate bonds: not as risky as you think

What’s more dangerous to own, company debt or government debt? Once, your instinctive answer might have been company debt. But a glance back in history might make you rethink.

Consider the riskiness of owning a million francs’ worth of shares in a French champagne company in 1928, compared with that of owning the equivalent value in long-term German bonds, says John Dizard in the Financial Times. If you’d gone for the shares, they would be extremely valuable today. The bond certificates and interest coupons would not be.

You might think this can’t happen again. But “almost all [...]

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