What is the difference between stocks and bonds?

What is the difference between stocks and bonds?

Stocks represent ownership in a company, while bonds are loans made to a company or government.

Can you explain how stocks and bonds are traded?

Stocks are traded on stock exchanges, while bonds are typically traded over-the-counter.

Which is considered a safer investment, stocks or bonds?

Bonds are generally considered safer than stocks, as they provide fixed interest payments and return of principal.

What are the potential returns on stocks compared to bonds?

Stocks have higher potential returns but come with higher risk, while bonds offer lower returns with more stability.