A Bond Fund, sometimes known as a debt fund, is a type of pooled investment that mainly invests in bonds and other debt securities. A bond fund's primary objective is frequently to produce monthly income for its owners. The majority of investors have access to both bond mutual funds and bond exchange traded funds (ETFs).Bond funds make monthly distributions of interest and principal payments, making them a desirable alternative for income-focused investors. A wide spectrum of investors can access bond funds because many of them have modest minimum investment requirements.The risk associated with investing in a bond fund varies depending on the type of bonds held by the fund. For example, "government bonds are typically considered low-risk investments, while corporate bonds carry more risk since they are not backed by the full faith and credit of the U.S government."When evaluating whether or not a particular bond mutual fund is right for you it’s important consider your overall financial goals and objectives; "understanding how different types of risks can impact your portfolio as well as how frequently you plan on accessing your money."Investors should carefully read the prospectus before investing in any mutual or exchange-traded Fund because it contains detailed information about individual Funds including investment objectives strategies risks fees charges and other important information.
