Investors buy such bonds because they offer return with practically no risk on capital. Since stocks fluctuate, the bonds percentage in portflio will rise when stock market falls, if interest rates do not change. There is also the effect of the return of bonds which contributes additional money to your portfolio.
You can invest in bonds in a a variety of mutual funds. The management fees however are too high particularly in a world of low interest rates. Therefore one may due better by buying bonds directly.
You will need not only how to buy bonds, but also how to sell bonds. Make sure you read the step on how to sell your bonds at a possibly higher price.For this you need an Demat account compulsory .
The second set of how to buy and sell bonds concern the selling of bonds. If interest rises decrease, your bond might be worth more money than the fact value of the bond. If this is the case, you should consider selling it in the secondary market rather than returning it, who will be happy to take it from you. This is where you need a second brokerage account open at stock brokerage firms. The commissions are typically very low. Under any case, you need to calcuate the fair value of your bond, to know its price given is coupon, current interest rates, and time left in the bond.
Once you decide on brokerage firms and open a trading account if you do not have one already, you should run your bond on a bon calculator to double check the numbers given to you by your broker.
One should particularly be careful on whether to buy corporate bonds directly.Some corporations sell bonds on their sites. Corporate bonds are riskier, and since one does not know the internal financial situations of corporations, it is better to invest in corporate bonds via mutual funds. The fund manager knows more than you and I, or at least he is supposed to, and the fund offers diversification among multiple corporations, and other types of bond.