Public, a New York-based investing platform, has unveiled a new bond account, aimed at allowing investors to diversify their portfolios with corporate bonds offering yields of up to 7.3%. This launch comes as investors increasingly seek stable returns in anticipation of potential Federal Reserve rate cuts in late 2024 or early 2025.
Expanding Opportunities in Bond Investing
Public’s bond account provides a straightforward way for investors to access a curated selection of ten corporate bonds issued by prominent companies across various industries. These bonds offer yields ranging from 6% to 9%, enabling investors to diversify without the need to individually select each bond.
The bonds featured in this account include those from well-known firms such as Boeing, Tapestry, Warner Media LLC, Main Street Capital Corp, and Vornado Realty LP. This diverse mix aims to help investors spread risk while capitalizing on attractive yields.
Jannick Malling, Co-CEO and Co-Founder of Public, highlighted the appeal of locking in higher yields now: “As rates potentially come down later this year and into next year, we are hearing from investors who want to secure a higher yield, and our Bond Account allows you to invest in the bond market with just a few clicks.”
The launch of the bond account aligns with market expectations that the Federal Reserve may begin cutting interest rates towards the end of 2024 or early 2025. When rates decrease, bond yields are likely to decline as well, making the current environment particularly favorable for locking in long-term bond investments.
Accessible and User-Friendly Features
Public has designed its bond account to be both accessible and easy to use. With a minimum investment requirement of just $1,000, it is significantly more approachable than many other platforms, which often require minimums of $10,000.
Interest earned on these bonds is automatically reinvested once it reaches approximately $1,000, facilitating the compounding of returns. Additionally, investors can set up recurring investments to further grow their bond portfolios over time.
This bond account is part of Public’s broader strategy to make diverse asset classes more accessible to retail investors. It follows the success of their Treasury Account, which simplified the process of investing in U.S. Treasury bills and quickly gained popularity.
In May, Public introduced fractional bond trading, allowing investors to buy and sell corporate and Treasury bonds in smaller denominations. This feature enables users to invest in bonds with as little as $100, lowering the barrier to entry in the bond market.
With these new offerings, Public continues to expand its range of investment products, catering to the growing demand for fixed-income investments in a changing economic landscape.
