What Are Bonds and Why Own Them? | ETF Trends

“Companies have the ability to raise money in a lot of different ways. If they want to let investors own a part in their company, they will sell stock. If they want to borrow money, they may go to a bank or they might borrow money directly from an investor in the form of a bond. A bond basically works like a loan. The company who issues the bond is considered a borrower and the investor who lends their money to the company is considered the lender.”

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