I've recently run into a bit of doubt and just want to make sure. If you are using keywords in your anchor text e.g "racing cars" does that mean the SE will pick it up as a link for both "racing" and "cars" and the phrase "racing cars", or just for the phrase?
From my experience this is how it works... If you have the anchor of "racing cars", it will credit for each individually, as well as both together. For example, if you have a site about racing cars and racing boats, the "racing cars" anchor will actually help you rank for racing boats too, as long as the boats part is in your title and body text too. I will show you a very good example of this. I have the page Music Software. Almost everywhere I submit it, I submit with the anchor text "Music Software". However, it ranks better for music editor, music converter, etc. than it does for music software! (I think just because the music software has more competition. So, as you can see, just having the "music" in there helps with other related searches also.
It will greatly help for the exact keyphrase. But, no doubt, it will help less (don;t know the exact degree) for any internal keyword in the anchor.
Right. I imagine it does help less for non-exact. Just worked out differently in my example due to other circumstances.
That's my main worry. For one of my sites it makes little sense to use just one keyword, the phrase is better, but half of the phrase is a keyword on it's own which is more important than the whole phrase.
Anchor links just defines the theme of your site to the search engine. Phrase or not, as long as your anchor link matches the title (which in all sense, is a phrase) of your page, you should be highly credited.