Bonds

Bonds are debt securities issued by governments, municipalities, or corporations to raise capital. When you buy a bond, you are essentially lending money to the issuer in exchange for regular interest payments (coupon payments) and the return of the principal amount at the bond’s maturity date. Investors trade bonds in the bond market, buying and selling them to capitalize on changes in interest rates, credit spreads, and market conditions. Bonds are often considered as a fixed-income investment, offering a predictable stream of income and serving as a diversification tool in investment portfolios. However, it’s essential for investors to assess their risk tolerance and investment objectives before investing in bonds.