What are the safest bonds with a fair return?
I will go on the assumption that you mean by “safe” that the bond is free from credit risk. I will also assume that by “fair” you mean average compared with other current yields; neither too low nor too high. I place the emphasis on the safe, or quality angle. All bonds are subject to various risks such as credit risk, reinvestment risk, price change or market risk caused by fluctuating interest rates. But the safest from a credit perspective are the bonds and other obligations issued by the US Treasury. The shorter maturity issues usually have less market rate risk than longer maturities. The zero coupon issues (bills and STRIPS) don’t have reinvestment risk since there is no interest to reinvest. Since they are all subject to interest rate movements, they have price risk with the non-interest bearing issues subject to greater volatility than their comparable maturity counterparts. Series EE savings bonds don’t have market risk, as they are not marketable. You can redeem them after si
