Definition

A bond issued by a company to raise funds, offering periodic interest payments and the return of principal at maturity.

What to consider

  • Review the credit rating of the issuing company before investing.
  • Consider the bond’s maturity and yield as part of your strategy.
  • Include corporate bonds to diversify your fixed-income portfolio.

Real world scenarios

  • For a balanced portfolio, Mark purchased a corporate bond, attracted by the regular interest payments and relatively stable risk profile.

Related terms

Investments & Retirement