Corporate Bonds
A corporate bond is a debt security issued by a corporation and sold to investors. The bond issuer is obligated to pay periodic interest payments to the bondholders and to repay the principal amount of the bond at maturity. Corporate bonds are generally considered to be higher risk investments than government bonds, but they typically offer higher yields than government bonds. Corporate bonds are typically issued in denominations of $1,000 or more and are traded on the secondary market.
History of Corporate Bonds
The history of corporate bonds dates back to the early 19th century, when the first corporate bonds were issued in the United States. The first corporate bonds were issued by the Bank of the United States in 1812. Since then, corporate bonds have become an important source of financing for corporations. Today, corporate bonds are issued by companies of all sizes, from small start-ups to large multinational corporations.
Comparison of Corporate Bonds and Government Bonds
| Corporate Bonds | Government Bonds |
|---|---|
| Higher Risk | Lower Risk |
| Higher Yields | Lower Yields |
| Issued in Denominations of $1,000 or more | Issued in Denominations of $100 or more |
| Traded on the Secondary Market | Traded on the Primary Market |
Summary
Corporate bonds are debt securities issued by corporations and sold to investors. They are generally considered to be higher risk investments than government bonds, but they typically offer higher yields. Corporate bonds are typically issued in denominations of $1,000 or more and are traded on the secondary market. For more information about corporate bonds, you can visit websites such as Investopedia, The Balance, and Bloomberg.
See Also
- Government Bonds
- Municipal Bonds
- Treasury Bonds
- Treasury Bills
- Treasury Notes
- Junk Bonds
- Convertible Bonds
- Zero-Coupon Bonds
- Floating Rate Notes
- Asset-Backed Securities
