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November 15, 2022
Foundations

Bond Markets Explained Simply

Learn how bonds work as a form of lending to governments and corporations, and their role in a diversified portfolio.

A conceptual image of a formal financial bond certificate.

Unlike stocks, which represent ownership, bonds are essentially loans. Investors who buy bonds receive periodic interest payments and get their principal back at maturity. They are generally considered less risky than stocks and provide a stable income stream.