How are bonds and stocks different
Business · Middle School · Thu Feb 04 2021
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Bonds are issued by corporations as a unit of debt whereas the corporation borrows money from the bondholders, and set a maturity date for the bond in which the corporation will pay the bondholder during the maturity date with the amount plus the interest gained. Bond is considered to be a tradeable asset, and one of the asset classes for investors.
Stocks are measured in shares, which means that if a person has a stock of the company, this certifies a partial ownership of that company. The owner of the certificates are classified to be stockholders or shareholders, and they also experience the profit gain or the loss of a company depending on the economical performance. Stock is also considered as a tradeable asset, and one of the asset classes for investors.
Stocks and Bonds differ, since bonds are money that is lent to the corporation as a form of debt, while stocks are money that is given to companies in order to gain certificates for dividends and interest.