Insured bonds historically have retained more of their market value than comparable uninsured bonds in difficult economic times. In particular, bonds of issuers that have been downgraded or have experienced fiscal problems perform better if insured.
Credit risk is less of a factor for bond funds that invest in insured bonds or U.S. Treasury bonds. By contrast, those that invest in the bonds of companies with poor credit ratings generally will be subject to higher risk.
risk, but funds holding bonds with longer maturities are more subject to this risk than funds holding bonds with shorter maturities. Because of this type of risk, you can lose money in a bond fund, including those that invest only in insured bonds or ...
 See also: Corporate Bond, Securities, Bonds, Market, Issue
  
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