Municipal Bonds; A Statement of the Principles of Law and Custom Governing the Issue of American Municipal Bonds

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1922 Excerpt: ... to principal and interest, on which the owner receives the interest by check at stated periods, or from which he may detach the coupons and cash them, requires little care. A safe deposit box for the registered bond, and semi-annual visits to it in the case of the coupon bond, represent all the care that is necessary for the bond if the bond has been wisely selected in every respect. Acceptable duration.--The investor, if an individual, does not care particularly about changing the character of his investments, and prefers that they remain constant for periods of shorter or greater duration. Investments for individuals may be said to be for a lifetime. Where no question of depreciation of security is involved, a term of from twenty to fifty years is not too long, and it is generally true that investors prefer the longer-to the shorter-term bond. Trustees and executors have particular requirements which depend upon the terms of the trusts pursuant to which they are acting. While the tendency has been to shorten the term of municipal bonds, and while new issues of municipal bonds rarely have an average term of more than twenty years, it is possible for any kind of an investor to select a bond having a term which meets his particular needs. Acceptable denomination.--Municipal bonds are ordinarily of the denomination of $1,000 each, although there are many bonds of smaller denominations (called "baby bonds") offered in the market from time to time. The denomination of $1,000 is an easy one in which to make computations and is the accepted denomination in the market. Potential appreciation.--By this we mean possible increase in value of the principal. The possibilities of appreciation in speculation are without limit, but such appreciation is a desira...