The Premium Puzzle: Is Buying Bonds at a Premium a Smart Investment Move?
In the world of fixed-income investments, bonds are often viewed as a safe haven, providing a steady stream of income and capital preservation. However, the decision to purchase a bond at a premium—meaning you pay more than its face value—can be a complex one. This article delves into the intricacies of buying premium bonds, exploring the potential benefits and drawbacks, and ultimately answering the question: Is it good to buy a bond at a premium?