In: Finance
The bond market is a financial market that involves issuance and | |||||||||
trading of debt securities. | |||||||||
The bond market is a way for the government and corporations | |||||||||
to raise capital for government projects, business expansions and | |||||||||
ongoing operations. | |||||||||
You study the bond market as an investor when you want to invest your | |||||||||
money in financial instruments that are more liquid than a savings account | |||||||||
and have a lower risk than stocks. Bonds can be bought and sold and the price of | |||||||||
bonds varies with fluctuating interest rates. | |||||||||
There is a lot of learning opportunity when you study bonds because bonds are of | |||||||||
many different types. The bonds are corporate bonds, government bonds, municipal bonds, | |||||||||
mortgage backed bonds, asset backed bonds, and collateralized debt obligations. | |||||||||
Corporate bonds are usually issued to fund ongoing business or expansion projects for corporations. | |||||||||
Whereas government bonds and municipal bonds are issued to fund government projects throughout | |||||||||
the United States. |