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Topic Content:
- Meaning of Bond
- Types of Bonds
A bond is a debt security issued by a government, its agency, or a corporate institution as a means of raising funds. A bond is also a negotiable certificate evidencing indebtedness that the issuer owes the bondholders.
A bond investor lends money to the issuer and in exchange, the issuer promises to repay the loan amount on a specified maturity date.
The most common types of bonds are municipal bonds and corporate bonds. The issuer usually pays the bondholder some periodic interest payments over the life of the bond.
Types of Bonds:
(1) Convertible Bond: This is a type of bond that gives the investors an option to convert the bond to other securities (equity) at some future date
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