Bonds

Bonds are used by both corporations and government agencies to create funds by essentially borrowing money from bondholders. The money is paid back when the bond matures. In return, the bondholder enjoys interest payments on the bond’s principal.

• Low risk
• Slow and steady
• Better investment than typically found in a bank
• Provide stability

^{The return and principal value of bonds fluctuate with changes in market conditions. If bonds are not held to maturity, they may be worth more or less than their original value.}