A bond is a debt instrument through which an entity, a company, bank, or government borrows money from investors. When you buy a bond, you are lending money to the issuer. In return, the issuer pays you fixed interest (called coupon) at regular intervals and returns the principal at the end of the tenure.<\/p>\n\n\n\n
For example, if a company issues a bond with a face value of \u20b91,000, a coupon rate of 8%, and a 5-year tenure you receive \u20b980 per year for 5 years and get your \u20b91,000 back at the end.<\/p>\n\n\n\n
Bonds can be issued by the government or by companies. Government bonds are considered the safest since they are backed by the government. Corporate bonds offer higher interest rates but carry more risk. There are also tax-free bonds issued by government-backed entities where the interest earned is exempt from tax.<\/p>\n\n\n\n
Unlike stocks, bonds do not give you ownership in the company. You are a lender, not a part-owner. Returns are fixed and predictable, which makes bonds generally lower risk than equity. However, if the issuer defaults, there is a risk of not receiving your interest or principal on time.<\/p>\n\n\n\n
Bonds are suitable for investors looking for stable income with lower risk compared to equity.<\/p>\n","protected":false},"author":65,"comment_status":"open","ping_status":"closed","template":"","format":"standard","meta":[],"ht_kb_category":[2973],"ht_kb_tag":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb\/27685"}],"collection":[{"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb"}],"about":[{"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/types\/ht_kb"}],"author":[{"embeddable":true,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/users\/65"}],"replies":[{"embeddable":true,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/comments?post=27685"}],"version-history":[{"count":1,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb\/27685\/revisions"}],"predecessor-version":[{"id":27687,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb\/27685\/revisions\/27687"}],"wp:attachment":[{"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/media?parent=27685"}],"wp:term":[{"taxonomy":"ht_kb_category","embeddable":true,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb_category?post=27685"},{"taxonomy":"ht_kb_tag","embeddable":true,"href":"https:\/\/www.samco.in\/help-support\/wp-json\/wp\/v2\/ht_kb_tag?post=27685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}