Bond
A debt security: a loan an investor makes to a company or a government, which pays interest on a set schedule and returns the borrowed amount at the end of the term.
Buying a corporate bond makes a consumer a lender to that business, which is the corporate-scale version of the shop's equipment loan.
Often Confused With
- Stock
- A bond makes you a lender with a claim on interest; a share of stock makes you an owner with a claim on profits.
Taught In
See Also
3.5.B.4 · 3.5.C.2 · 5.3.B.1 · 5.3.B.3