A bond is a loan an investor makes to a government or company in exchange for regular interest payments and the return of the principal at maturity. Bonds are generally less risky than stocks and provide steady income, which is why they are used to balance and stabilise a portfolio. Bond prices fall when interest rates rise, and vice versa.
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Market Navigator Glossary — plain-English definitions of 93+ investing and crypto terms. All content is for educational purposes only and does not constitute financial advice.