Bond

A bond is a fixed income instrument representing a loan made by an investor to a borrower, which can be a corporation or a government. When you buy a bond, you are essentially lending money to the issuer in exchange for regular interest payments (known as coupon payments) over a specified period. At the end of this period, called the maturity date, the issuer repays the original principal amount (face value) to the bondholder. Bonds are crucial for companies and governments to raise capital for projects, operations, or to refinance existing debt.