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What are the characteristics of bonds?

Some of the characteristics of bonds include their maturity, their coupon (interest) rate, their tax status, and their callability. Several types of risks associated with bonds include interest rate risk, credit/default risk, and prepayment risk. Most bonds come with ratings that describe their investment grade. How Do Bonds Work?

What are the different types of bonds?

Different bond types—government, corporate, or municipal—have unique characteristics influencing their risk and return profile. Understanding how they differ and the relationship between the prices of bond securities and market interest rates is crucial before investing.

What is a bond & how does it work?

Bonds are financial instruments that investors buy to earn interest. Essentially, buying a bond means lending money to the issuer, which could be a company or government entity. The bond has a predetermined maturity date and a specified interest rate.

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