Bonds and Treasuries
Stock Market
The Difference Between

What is the difference between stocks and bonds?

252627

Top Answer
User Avatar
Wiki User
Answered
2015-12-02 10:49:13
2015-12-02 10:49:13

Stocks (aka Equities): Stocks represent partial ownership of a corporation. If the corporation does well, its value increases, and you share in the appreciation. However, if the corporation goes bankrupt, you can lose your entire initial investment.

Bonds (aka Notes): Bonds represent a loan you make to a corporation or government. For example, you can buy a US Treasury bond for $100, and get a guaranteed interest rate for 5-years, and can expect to get your $100 back at the end of that 5-years plus interest. Your risk is repayment of the principal (amount invested). Because loaning $100 to the U.S. government is much less risky than loaning $100 to the Brazilian government, U.S. government bonds pay a much lower rate of interest ("coupon") for borrowing your money. Stocks and Bonds .... How do they differ Stocks are EQUITY. They represent shares of ownership in a Corporation. A Stockholder is actually one of many owners of a Publicly Owned Corporation. If a Corporation dissolves for any reason owners of Common Stock (the main type of stock issued) receive the value of the sold assets of the Corporation AFTER everyone else is paid, including the IRS, Employees, Bonds, Accounts Payable, etc.

Bonds are DEBT. They are sold by the Corporation in order to raise money for various purposes for use by the company. Bonds offer an interest rate to the Bondholder for the period of time that the Bondholder owns the bonds.

Since bonds do not represent ownership, the bondholder could lose their investment if the Corporation dissolves, but are paid BEFORE owners of stock.

When you buy either bonds or stock, you pay money now with the possibility of getting more money later. But a bond represents a debt--the company that issued the bond owes you money to be paid when the bond is redeemed. A stock represents ownership. As a stockholder, you become a part owner of the company.

Stocks, compared to bonds, have which of the following characteristics?

(Apex)-----

A. No guarantees

001
๐ŸŽƒ
0
๐Ÿคจ
0
๐Ÿ˜ฎ
0
๐Ÿ˜‚
0
User Avatar

Related Questions


what is the difference between stocks,shares and bonds


stocks are stocks and bonds are bonds . flatout -ashes


The only difference between the 2 is that a stock represents ownership and a bond is a long term debt. You will be paid via stocks but only receive interest from bonds.


1)stocks are in units, whereas bonds are for number of years. 2)stocks are the number of units for the companies whereas bonds can be for short or long term


The difference between bonds shares and mutual funds is in their definition. Bond shares refers to the individual shares that an investor owns in a company while mutual fund is the collection of all the stocks and shares in a company.


They do in fact issue stocks and bonds.


Capital market is stock exchange. It trades stocks and bonds. Money market's main object of trading is curency.


Stocks are investments in individual companies. Bonds are investments in government agencies such as cities and municipalities. Stocks are generally riskier than bonds, but bonds have a lower yield.


A stock exchange is a place where stocks are traded. Stocks are shares of a company. Bonds are like a loan to a company.


When a company issues bonds, yes. Stocks, no.


the difference between ionic bonds and meals is that metals are able to be bent and ionc bonds cant bend without breaking


Nonpolar bonds show a Low electronegativity difference between atoms



They become part of the deceased persons estate If the decedent had a will, the stocks and bonds pass on to the wills beneficiaries If there was no will, the state intestacy laws determine who gets the stocks and bonds


Wealth is what you have in the bank and assets you can sell (house, car, boat, stocks, bonds, ...) Income is what your employer gives you (or you take out of your own company)


Stocks are considered much more liquid than bonds. This is because stocks are riskier and the value of the stock is determined by the present market.


Covalent bonds are formed by sharing of valence electrons and ionic bonds are formed by electrostatic bonds between ions.


Corporate bonds are issued by a company, Treasury bonds by the government


The stocks and bonds are sold by the companies are due appreciation of capital funds to meet the additional requirments of companies.


The major difference between the two is: - Ionic bonds occur between one metal and one non-metal (such as sodium and oxygen) - Covalent bonds occur between two non-metals.


A physical asset is something tangible that is owned such as equipment, cash, and inventory. Financial assets refer to things such as stocks and bonds, which have value but are not tangible.


ionic bonds have strong bonds and molecular bonds have very strong bonds.


Hydrogen bonds are weaker than covalent bonds and are of electrostatic attraction nature.


Non-popar bonds are bonds between two or more elements where the electronegativity difference between them is less than .5.


Ionic bonds are based on the electrostatic attraction of ions; covalent bonds are based on the sharing of electrons between two atoms.



Copyright ยฉ 2020 Multiply Media, LLC. All Rights Reserved. The material on this site can not be reproduced, distributed, transmitted, cached or otherwise used, except with prior written permission of Multiply.