Bonds sit somewhere between boring and a godsend...
They can let you sleep well at night with the promise of interest payments and an almost certain return of capital at a fixed rate for a long period of time.
And, despite their lack of popularity with the average investor, the bond market is actually larger than the equity market.
Adding safe fixed-income bonds to your portfolio is a simple way to stabilize your investment returns over time. But most folks don't really understand how bonds work. Here's what you need to know...
Fixed-income investments like bonds have an upfront cost. Then, they pay interest payments and return the principal amount at maturity.
But between a bond's issue date and its maturity date, its price fluctuates...
The price of bonds matters greatly to money managers who have to issue quarterly statements to clients. But it shouldn't matter to you.
It's simple... Say you go out today and buy a $1,000 five-year corporate bond with a 4% yield. That means you'll earn 4%, or $40, per year for five years, for a total of $200. And at the end, you'll receive your original $1,000 back.
During those five years, the market price of the bond will rise and fall... If a liquidity crisis hits, it might sell for $800. But if you hold it for the duration, fluctuating prices shouldn't matter the slightest bit to you. You'd still get your $1,000 back at the end of five years. It doesn't get much safer than that.
The risk of bond investing is if the company runs into serious financial trouble... If the bond were to default, then you'd lose money. But this is rare, depending on the type of bond you're investing in.
Bond managers can't always hold a bond to maturity... They need to generate a return each year. For them, that includes both the interest payments and the change in price.
But you don't have to worry about that.
If you're investing in bonds for the long term, you've already locked in your income yield. You don't have to care about price moves like bond managers do.
And you can take advantage of them...
We mentioned how a bond's price might fall from $1,000 to $800. If you buy it at $800, you're still entitled to collect $1,000 at maturity – plus all the interest along the way.
That opportunity is in place right now...
According to Joel Litman and Rob Spivey – from our corporate affiliate Altimetry – President Donald Trump is actively working to reshape the Federal Reserve by installing leadership willing to push interest rates sharply lower...
That's something current Fed Chair Jerome Powell hasn't been willing to do. And while rates have remained higher, many bonds have traded at steep discounts.
But with Powell on his way out in May, a new phase of aggressive interest-rate lowering is likely. When Treasury bonds have high interest rates, corporate bonds become less valuable. If that changes, these discounted bonds could snap back toward full value in a relatively short period of time.
If that happens, Joel and Rob say that investors could see gains of 40% to 100% or more in assets backed by legal repayment contracts. Plus, you'd earn steady income along the way. This rare "best of both worlds" scenario combines the upside of a growth investment with a risk profile closer to Treasury bonds.
However, they warn that once interest rates begin falling in earnest, this mispricing is likely to disappear. So it's critical for investors to act early to take advantage of this opportunity.
If you're anything like me, you want to sleep well at night knowing your wealth is invested safely. And "boring" bonds can actually be a blessing in disguise for your portfolio.
Get the details here while there's still time.
Now, let's get to this week's Q&A... And as always, keep sending your comments, questions, and topic suggestions to feedback@healthandwealthbulletin.com. My team and I read every e-mail.
Is Hydrogen Water Worth the Price?
Q: I see the latest item being touted for health support is hydrogen-[infused] water. Ads claim several health benefits, such as fighting inflammation in the joints, increased energy levels, faster muscle recovery, improved cognitive function, and reduced oxidative stress and premature aging. Please give us your opinion on the effectiveness of this product and if it really helps. Thanks. – W.E.
A: Thanks for writing in, W.E. For folks who haven't heard of it, hydrogen water has extra hydrogen gas dissolved in it. You can buy it bottled, or you can buy hydrogen tablets to add to water yourself.
The idea is that hydrogen water's antioxidant and anti-inflammatory properties could reduce oxidative stress, a major driver of inflammation. This would help patients with inflammatory diseases like nonalcoholic fatty liver disease ("NAFLD"). And some evidence suggests this might even be the case.
Trouble is, most of the studies we found were either too small to be statistically significant, were done on rodents (the results of which don't reliably translate to human studies), or showed very little benefit.
There doesn't seem to be any risk in drinking hydrogen water – except to your wallet. At $2 to $5 per bottle on average, I personally wouldn't bother wasting the money.
Plain old water is just as good for our health. And there are other, more reliably proven ways to get the health benefits those hydrogen-water ads claim.
Do what I do by eating a balanced, anti-inflammatory diet and exercising regularly. This, paired with plenty of water intake, can help reduce inflammation, joint pain, and stress, as well as improve your energy levels and brain function.
What We're Reading...
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Here's to our health, wealth, and a great retirement,
Dr. David Eifrig and the Health & Wealth Bulletin Research Team
February 6, 2026