Bonds

Bonds are fixed-income securities that allow governments and businesses to raise funds from the general public and are largely considered risk-free investments. The bond issuer promises a return on investment, plus interest, over a fixed period of time. Generally, bonds are issued to raise funding for specific projects. In exchange, the bond issuer pledges to repay the investment, plus interest, over a specified timeframe.

Bond prices don’t really fluctuate quite as often as stock markets. Another advantage of bonds is that they provide a steady source of income by paying you a defined sum of interest twice a year.