What is a bond, in simple words?
A bond is a loan you give to a government or company; they pay you regular interest and return your principal at the end. Steadier than stocks.
A bond is essentially a loan you make to a borrower — usually a government or a company. In return, the borrower promises to pay you a fixed rate of interest (the "coupon") at regular intervals and to return your original amount (the "principal" or "face value") on a set maturity date.
Bonds sit at the lower-risk end of investing compared to stocks. With a stock you own a piece of the business and ride its ups and downs; with a bond you are a lender with a contractual claim to interest and repayment, which ranks ahead of shareholders if things go wrong. The trade-off is lower expected returns.
Two big risks remain. Credit risk is the chance the borrower can’t pay — government bonds (like Indian G-Secs) are safest, company bonds vary by rating. Interest-rate risk means existing bond prices fall when new interest rates rise. For most investors, bonds (or debt mutual funds) are the stabilising, income part of a portfolio.
See it on real companies
Browse live financials and decoded filings, or just ask in plain English.
Common questions
Are bonds safer than stocks?
Generally yes — bondholders get fixed interest and rank ahead of shareholders for repayment. But "safer" isn’t "risk-free": weak issuers can default, and bond prices fall when interest rates rise.
How do I buy bonds in India?
Retail investors can buy government bonds via the RBI Retail Direct platform or through brokers, and access corporate bonds and G-Secs through debt mutual funds or bond platforms.