Bonds

Bonds are a type of investment where the investor lends money to an entity (generally a company or government) in exchange for payment in full with interest. Bond owners are called bondholders, and are not owners of the corporation, but are owed a debt by the company or government. There are various types of bonds but generally bondholders are paid periodic interest payments known as coupon payments, and then re-paid the principle amount at the end of the bond term. Bonds are also called fixed income investments because they provide generally fixed returns when held to maturity.