Beaufort Securities’ Guide to Corporate Bonds
A corporate bond is a debt security issued by a company and sold to investors. The backing for the bond is usually the payment ability of the company, which is typically money to be earned from future operations. In some cases, the company’s physical assets may be used as collateral for bonds. Corporate bonds are considered higher risk than government bonds and you could get back less than you invest. As a result, interest rates are almost always higher, even for top-flight credit quality companies.
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