A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- BondA loan you make to a government or company that pays you interest and returns your money on a set date.
- Corporate BondA loan you make to a company that pays interest and generally offers higher yields but more risk than government bonds.
- Junk BondA bond from a lower-rated issuer that pays higher interest to make up for a greater chance of default.
- Investment GradeA quality tier for bonds from issuers considered financially strong and likely to repay their debt.
- Default RiskThe chance that a bond issuer fails to make interest payments or repay the loan as promised.
- Government BondA loan to a national government, generally seen as low risk because it is backed by the government's ability to tax.
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Plain-English education — not personalized legal, tax, or investment advice.