Investing for Less than Three Year Period

When I was in my 20s, I tried telling my mother how to invest her money. She did not want to hear it. After all, she knew everything and I knew nothing. It was the 1970s, a time of high inflation. Money market funds were giving 7 to 9 percent interest. Bank accounts were giving 5 percent. Inflation was running round 8 percent. She kept her money in a savings account. She never changed and she lost at least 3 percent due to inflation per year.

Today, we are in danger of deflation. Saving accounts are giving less than one percent. Money Market accounts are giving a little over one half percent. Inflation is at about 3.8 percent. Needless to say, you change with the times.

That is why we are going to talk about investing in corporate bonds that mature in about two to three years. The information that I am talking about here was taken on Sept. 30, 2011.

International Lease Financial M 5.625% of 09/20/2013 selling for $965
Bond is rated BBB- by S&P CUSIP is 45974VA81

The International Lease Finance Corporation (ILFC) is an aircraft lessor headquartered in Century City, Los Angeles, California.

It is the world's largest aircraft lessor by value, though ILFC's rival, General Electric's GECAS unit, has more aircraft. It leases Boeing and Airbus aircraft to major airlines worldwide, including AeroMexico, Air Canada, Asiana Airlines, Korean Air, Cathay Pacific, Cyprus Airways, Air France-KLM, Lufthansa, Alaska Airlines, American Airlines, Air India, Continental Airlines, Norwegian Air Shuttle, Mexicana, Pakistan International Airlines, Emirates Airline, Gulf Air and most recently, Delta Air Lines.

Royal Bank of Scotland Group P 5% of 11/12/2013 selling for $964.10
Bond is rated BBB by S&P CUSIP 780097AN1

The Royal Bank of Scotland Group (LSE: RBS) is a British banking and insurance holding company in which the UK Government (HM Treasury) holds an 84% controlling share (economic interest; actual voting rights will not rise above 75% in order for it to retain its listing on the London Stock Exchange). This stake is held and managed through UK Financial Investments Limited. The group is based in Edinburgh, Scotland, and is the world's largest company by assets. The group controls the Royal Bank of Scotland plc, founded in 1727 by a Royal Charter of King George I, the National Westminster Bank, which can trace its lineage back to 1650, and Ulster Bank in Ireland.

APRIA Healthcare Group Inc. 11.25% of 11/01/2014 selling for $975

Bond is rated BB+ by S&P CUSIP 037933AE8

Apria Healthcare Group Inc., together with its subsidiaries, provides home healthcare products and services in the United States. It offers home respiratory therapy, home infusion therapy, and home medical equipment services. The company’s home respiratory therapy products and services include oxygen systems, ventilators, respiratory assist devices, continuous positive airway pressure and bi-level devices, infant apnea monitors, nebulizers, and sleep apnea devices, which are used to treat chronic obstructive pulmonary diseases, respiratory conditions associated with nervous system disorders or injuries, congestive heart failures, and lung cancers.

I own bonds in International Lease Financial and Apria Healthcare Group Inc.