The answer is: it depends. Investors have to decide among numerous options when they are making investment decisions. One of the most common dilemmas arises when an investor needs to decide whether to put their money in a mutual fund or directly in a bond. Now let us look at how the options differ.

INCOME

Buying a bond gives you a fixed return, so a five per cent yield on a bond purchased with US$10,000 face value will give you the investor US$250 cash in hand, twice a year. Many mutual funds do not pay interest, so if you are looking for steady cash flow, this would not be the best option for you.

Now, if you need money, where would you go?

http://www.jamaicaobserver.com/sunday-finance/should-i-buy-a-bond-or-a-mutual-fund-_203514