Fixed income securities since long have been considered as a low investment tool and hence during its initial days was limited only to low-level traders and investors. However, the changing regulations, as well as the availability of advanced tools and techniques to lower risks in investment, has caused a tremendous shift of modern investors into this market. Using the right investment strategies investors have been able to secure high returns even in the market which according to many offers low returns.
Therefore, to help both the professionals as well as newbies make a profit in this otherwise slow-growing market, we have decided to compile the list of top 5 fixed income securities books which we believe everyone should read.
Fixed Income Mathematics
Written by Frank J. Fabozzi, Fixed Income Mathematics explains the readers about various sorts of mathematical as well as statistical tools which are available to evaluate fixed income securities. The book covers and defines different types of securities such as mortgage-backed security and or asset-backed security, and then dwells into the risks associated with each kind of investment. This book though is meant to be read by anyone who is proficient with finance and mathematics. However, certain sections do demand the reader to know advanced financial concepts.
Fixed Income Securities
Fixed Income Securities, is one of the few practical guides to evaluating and investing in various types of securities. The guide tends to explain different types of securities available in the market and then further tends to dwell onto the topic of risk assessment and mitigation in detail. The author has also tried to simplify the whole concept in ways an average reader can understand and towards the end, you will find him explaining the pros and cons of various valuation models.
Interest Rate Risk Modelling
This book written by Sanjay K. Nawalkha is a part of a trilogy focussed towards Fixed Income Securities. However, as the name suggests the book is written explicitly with the motive of helping people understand interest rate risk modelling. The book covers a wide array of topics starting from M-Absolute, M-Square, convexity etc. The author to help the readers understand better has provided with a CD containing all the useful formulas which can help in self-analysis of the security.
The Handbook of Fixed Income Securities
If you wish to understand Fixed Income Securities from scratch, then there is no better book than one written by Frank J. Fabozzi. This book in contrast to Fixed Income Mathematics doesn’t dwell into the mathematical aspect, instead is more of a beginner’s guide to fixed income securities. It explains various evaluation models along with risk modelling and mitigation and then tends to demonstrate different methods of making profits through an investment. Some of the critical topic this book covers is risk analysis, corporate bond market, portfolio management etc. This book can serve as a reader’s only guide to investing in fixed income securities and making profits out of same.
These were the top 4 fixed income securities books which we would recommend any professional willing to get into the fixed income market to read and understand. If you have any other book suggestions, then don’t forget to mention them in the comment section below.
