Investing in Bonds Fixed-Income Securities Demystified
Bonds are fixed-income securities that can be a valuable addition to any investment portfolio. By purchasing a bond, an investor is essentially lending money to a government or corporation in exchange for regular interest payments and the return of the initial investment at a specified maturity date. Bonds are considered lower risk than stocks, making them a popular choice for conservative investors looking to generate income while preserving capital. With various types of bonds available, including government bonds, corporate bonds, and municipal bonds, investors have a range of options to choose from based on their risk tolerance and investment goals. Understanding how bonds work and the key factors to consider when investing in them can help investors make informed decisions and maximize their investment returns.