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What Is a Bond?
Lending money to governments and companies
A bond is a loan you give to a government or company in exchange for regular interest payments and the return of your principal at maturity. Bonds are generally safer than stocks but offer lower returns. When interest rates rise, existing bond prices fall — and vice versa. The 10-year US Treasury yield is the most closely watched bond in the world.
Quick check
When interest rates rise, what happens to existing bond prices?