Bond Ladder

A strategy for managing fixed-income investments by which the investor builds a ladder by dividing his or her investment dollars evenly among bonds or CDs that mature at regular intervals such as every six months, once a year or every two years. 










    

            

            
   
        
        

            
Watch: Understanding Bonds
        
    




|||The advantages of bond ladders include consistent returns, low risk and ongoing liquidity thanks to the consistency of the expiring securities. The bond ladder also protects the investor's bond portfolio from call risk: since maturies are staggered, there is little chance that all the bonds in one portfolio will be called at once.