{"id":1056,"date":"2014-10-24T00:00:20","date_gmt":"2014-10-24T00:00:20","guid":{"rendered":"http:\/\/www.thompsonlawsd.com\/?p=1056"},"modified":"2014-09-16T17:52:36","modified_gmt":"2014-09-16T17:52:36","slug":"bonds","status":"publish","type":"post","link":"http:\/\/www.thompsonlawsd.com\/bonds\/","title":{"rendered":"What Are Bonds?"},"content":{"rendered":"\"What<\/a>\n

Whether you\u2019re just getting into investing or you\u2019ve been exploring the practice for a while now, you\u2019ve more than likely come across the word \u201cbonds\u201d before. They\u2019re a very popular investment, alongside stocks, mutual funds and commodities. However, just because they\u2019re common doesn\u2019t mean people know what they are.<\/p>\n

You may also hear bonds referred to as notes, bills, debt obligations, or debt securities. Most people simply just call them bonds though.<\/p>\n

Bonds are what we refer to as debt securities. They\u2019re kind of like an I.O.U., except that you are lending the money to a government, federal agency, corporation, municipality or some similar entity. In return for your loan, the entity, called an issuer, provides you with an I.O.U. that promises a specific amount of interest over the life of the bond, plus the principle investment, whenever it comes due or matures.<\/p>\n

One of the most popular types of bonds over the years has been U.S. government securities. Others include foreign government bonds, corporate bonds, federal agency securities, municipal bonds, and asset- and mortgage-backed securities.<\/p>\n

The main difference between bonds and stocks is that the former represents debt (as we mentioned) and the latter is equity. This is the main distinction. It means that a bondholder always gets paid before a shareholder because they\u2019re a creditor. However, a shareholder gets a share of the profits and, potentially, voting rights.<\/p>\n

So the upshot is that bonds provide far less risk than investing in stocks. However, you accept far less potential for rewards too, meaning your returns tend to be a lot less as a bondholder. Most people who prefer bonds over stocks understand that they\u2019ll probably see less money over the long term, but appreciate that they also won\u2019t have to suffer the short term volatility of the market.<\/p>\n

If you\u2019re just beginning to build your portfolio, it makes sense to put some money towards bonds. While it\u2019s true you\u2019ll make less, they\u2019re generally a sound investment you can rely on.<\/p>\n

Sources:<\/p>\n

http:\/\/www.investinginbonds.com\/learnmore.asp?catid=46&id=2<\/a><\/p>\n

http:\/\/www.investopedia.com\/university\/bonds\/bonds1.asp<\/p>\n","protected":false},"excerpt":{"rendered":"

Whether you\u2019re just getting into investing or you\u2019ve been exploring the practice for a while now, you\u2019ve more than likely come across the word \u201cbonds\u201d before. They\u2019re a very popular investment, alongside stocks, mutual funds and commodities. However, just because they\u2019re common doesn\u2019t mean people know what they are. You may also hear bonds referred […]<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[12],"tags":[],"acf":[],"yoast_head":"\nWhat Are Bonds? - Bankruptcy Lawyer<\/title>\n<meta name=\"description\" content=\"The Thompson Wedeking Bankruptcy article library provides all the information you need on Chapter 7, Chapter 11, and Chapter 13 Bankruptcy.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"http:\/\/www.thompsonlawsd.com\/bonds\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Are Bonds? - Bankruptcy Lawyer\" \/>\n<meta property=\"og:description\" content=\"The Thompson Wedeking Bankruptcy article library provides all the information you need on Chapter 7, Chapter 11, and Chapter 13 Bankruptcy.\" \/>\n<meta property=\"og:url\" content=\"http:\/\/www.thompsonlawsd.com\/bonds\/\" \/>\n<meta property=\"og:site_name\" content=\"Bankruptcy Lawyer\" \/>\n<meta property=\"article:published_time\" content=\"2014-10-24T00:00:20+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2014-09-16T17:52:36+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/www.thompsonlawsd.com\/wp-content\/uploads\/2014\/09\/iStock_000010103553_Small-300x199.jpg\" \/>\n<meta name=\"author\" content=\"Anthony Thompson\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Anthony Thompson\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"http:\/\/www.thompsonlawsd.com\/bonds\/\",\"url\":\"http:\/\/www.thompsonlawsd.com\/bonds\/\",\"name\":\"What Are Bonds? 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