Bond
Also known as: bonds, fixed income, debt security
A debt investment where an investor lends money and expects interest plus repayment over time.
Definition
A bond is a financial asset based on lending. The buyer is usually paid interest and expects the borrower to repay the original amount at a set time.
Example
A government bond pays interest to the buyer and returns the principal when the bond matures.
Important Context
Bonds can feel safer than other assets, but they still carry risk. Interest rates, inflation, credit quality, and time to maturity can all affect value.