I'm sure all of us have heard of bonds one way or another before. Either from the financial advisors who recommend you to buy a balanced bond fund or the bank personnel who told you that bonds are safe and give you a higher return than a savings deposit.


Before you invest into bonds, you must know the answers to these 4 questions:
1) What is a bond?
2) How does it work?
3) What are the types of bonds and their risk?
4) When is the right time for buying bonds?


What is a bond?
A bond is essentially a debt instrument. Government issue bonds so that they can borrow money from the public. The government is taking a loan from the bond investors. If you invest in that government bond, it means the government owes you money. You are lending money to the government.


How does a bond ......