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When do invest in bond ETFs versus the underlying bonds themselves? I know zilch about investing in bonds but I will have the need in a 5-to-10 year timeframe.

Other than you need a lot of $$ versus smaller $ with ETFs, what are the difficulties with investing in bonds?
Any opinions of when do to ETFs versus underlying bonds? Break-even points? Even do the underlying bonds as the cost savings might not be worth it?
 

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Most importantly - ETFs go on forever. Bonds you invest in directly have a fixed maturity.

That means that unless the company goes bankrupt, you can always hold your bond until it matures, and you will get your money back, plus the interest you expected.

An EFT holds bonds of many maturities, so if interest rates go up, as surely must happen at some point in time, the EFT will lose some value, while the rate of return based on the new value will be higher.

If possible, a good strategy is to hold bonds of various maturities and replace each when it matures, a bond ladder. Right now I would suggest nothing longer than 5 years maturity.

Unfortunately, regular bonds in Canada are traded over the counter and the spreads are high. You can buy convertible bonds on the TSX, which are easy to trade, but require care as they generally are not rated and some are quite risky. Check prices at http://www.financialpost.com/markets/market-data/bonds-debentures.html?tmp=debentures
 
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