Bond

Definition

• A debt instrument, issued for a period of at least one year that pays a fixed rate of interest for a specific period. A bond is an IOU from a corporation or government entity. Corporations and governments borrow money from investors by issuing bonds. Bonds represent debt, as opposed to stocks, which represent ownership in a company. Usually, the principal is repaid at the maturity date.

Synonyms
agreement, certificate, pledge

Related Terms and Acronyms

• Bond Ladder — Definition,
  • A series of bonds with different maturity dates, often times evenly spaced over a set period of time.
• Canada Savings Bond (CSB) — Acronym, Canada,
  • A secure way for Canadians to save. The bonds, which are a form of debt issued by the Canadian government, are cashable, with proper identification, at any time at most Canadian financial institutions.
• Current Yield — Definition,
  • The annual increase in the value of an investment, usually expressed as a percentage.
• Debt Issues — Definition,
  • The issuance of bonds or other forms of debt on the public markets.
• Fixed-Return Investments — Definition,
  • Investments that provide a stable return.
• Guaranteed Investment Certificate (GIC) — Acronym, Important,
  • An investment that pays a set rate of interest over a fixed period of time.
• Investment — Definition,
  • Something you put your money into in order to make money.
• Investment Banking (IBK) — Acronym,
  • Bank operations that manage a bank's funding position, as well as its holdings of Treasury bills, bonds and preferred and common stock.
• Investments in Affiliates — Definition,
  • A situation where an investor has a great deal of control over the operation and/or financial management of his or her investment.
• Issuer — Definition,
  • A legal entity that develops, registers, and sells securities including stocks, bonds and derivatives.
• Maturity — Definition,
  • The date when the principal balance of a loan is due and payable to the lender. Also, the date when a bond pays off its principal.
• Maturity Guarantee — Definition,
  • A guarantee that after a certain date a contract, such as a life insurance policy or annuity, will have a minimum dollar value.
• Portfolio — Definition,
  • A collection of investments.
• Securities/Investment Dealer — Definition,
  • One who acts as the agent for another party to buy and sell securities and other investments; also an underwriter.
• Security — Definition,
  • Property designated as collateral.
  • A document stating ownership of a stock or bond.
  • A tradable financial implement that represents ownership, the rights to ownership or debt.
• Segregated Fund — Definition,
  • Investment vehicles that feature both maturity and death guarantees. Segregated funds share similarities with mutual funds but are categorized as insurance products.
• Stock — Definition,
  • A share of the ownership of a company.