1. Bonds offer a middle ground between shares and cash in terms of risk and returns.
2. Bondholders make money by receiving regular payments of dividends over the life of the bond.
3. Bonds can have terms ranging from 1 year to 30 years.
4. If you do not hold a bond until maturity, you cannot lose money.
5. Bondholders are paid before shareholders in the event of a company bankruptcy.
6. Corporate bonds are considered safer than government bonds because companies rarely go bankrupt.
7. Treasury Inflation-Protected Securities (TIPS) protect against inflation by adjusting the coupon and interest payment.
8. The interest rate on government bonds is lower than corporate bonds because government bonds are safer.
9. Bonds usually move more in price than shares, which makes them riskier.
10. Bonds provide a way to diversify your investment portfolio by reducing risk.