What are bonds?
An example of an AI chatbot conversation about understanding bonds and their types.
Can you explain what bonds are?
Sure! Bonds are debt securities issued by entities like governments or corporations to raise capital.
How do bonds work?
When you buy a bond, you're lending money to the issuer in exchange for periodic interest payments and the return of the bond's face value at maturity.
What are the different types of bonds?
There are several types, including government bonds, corporate bonds, municipal bonds, and zero-coupon bonds.
What are the risks associated with investing in bonds?
Risks include interest rate risk, credit risk, and inflation risk, which can affect the bond's value and returns.
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