Bond

Definition

A bond is a debt instrument issued by governments, municipalities, or corporations to raise capital. It represents a loan made by an investor to the issuer, who promises to repay the principal amount along with periodic interest payments.

Related terms

Coupon Rate: The fixed annual interest rate paid on a bond.

Maturity Date: The date when the principal amount of a bond becomes due and is repaid.

Credit Rating: An assessment of an issuer's creditworthiness, indicating their ability to repay debts.