How to Buy Canadian Government Bonds

Investing in foreign government bonds from developed countries with efficient markets, such as Canada, is often less risky than investing in emerging markets. While yields from bonds in developing countries could be higher, the markets are also more volatile. Investing in Canadian government bonds is a safer option for American investors who want to try investing in foreign bonds.

Difficulty:

Moderate

Instructions

Things You'll Need

• Information on current bond prices, interest rates and yields
• Broker to place orders for you
• Funds to invest

Make Educated Decisions When Buying Canadian Bonds

1. Research the different types of Canadian government bonds available. Some come from the federal government, while others are provincial and municipal bonds.

2. Make educated investment decisions by knowing your own goals and understanding your unique financial situation. With this knowledge, you will be better able to select the right Canadian government bonds for your risk tolerance, goals and objectives.

3. Study trends in the Canadian government bond market over the last several decades. This will help you assess your potential return on investment and your potential risk. Remember that foreign bonds are not insured by the U.S. government and it is possible to lose all of your investment.

4. Use research tools provided by independent agencies to read expert opinions, get quotes on prices, yields, coupon rates and bond ratings. Such tools are unbiased and will help you evaluate a potential investment so you can make the best decision on which bonds to purchase.

Buy Canadian Government Bonds With Confidence

1. Talk to your financial advisor or investment broker to assess the risks and potential gains of investing in foreign bonds. He or she will be able to guide you based on your own goals and current portfolio.

2. Once you have decided which to buy, ask your investment broker to help you purchase Canadian government bonds on the secondary market. Most large discount brokers offer foreign investment products. If you prefer to buy your bonds online, you can do this through an online broker.

Tips & Warnings

• Locate a specialist in international investments if you want to purchase a large amount of bonds or get involved in trading. Also use a specialty broker if you want to invest in other foreign securities, such as stocks, corporate bonds or currency.