{"id":44470,"date":"2023-07-26T14:15:01","date_gmt":"2023-07-26T14:15:01","guid":{"rendered":"https:\/\/hardbacon.ca\/non-classifiee\/everything-you-always-wanted-to-know-about-bonds\/"},"modified":"2026-08-23T09:04:01","modified_gmt":"2026-08-23T13:04:01","slug":"everything-you-always-wanted-to-know-about-bonds","status":"publish","type":"post","link":"https:\/\/hardbacon.ca\/en\/investing\/everything-you-always-wanted-to-know-about-bonds\/","title":{"rendered":"Everything you always wanted to know about bonds"},"content":{"rendered":"
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Bonds are an essential ingredient in most <\/span>investment <\/span>portfolios<\/span>. <\/span>They are<\/span> negatively correlated <\/span>with<\/span> the<\/span> stock market, so <\/span>they reduce the ris<\/span>k <\/span>inherent in<\/span> a portfolio. <\/span>In addition<\/span>, <\/span>they provide<\/span> consistent returns <\/span>with<\/span> low volatility, <\/span>so they\u2019re<\/span> generally <\/span>a safe, <\/span>predictable investment <\/span>as well<\/span>. But do you really know what <\/span>a bond<\/span> is?<\/span><\/p>\n<\/div>\n<\/div>\n

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What is <\/span>a bond<\/span>?<\/span><\/strong><\/h2>\n

If <\/span>one of your<\/span> friend<\/span>s<\/span> wants to borrow money from you and promises <\/span>to repay you<\/span> at a later date with regular interest, <\/span>it\u2019s a type of obligation or a bond. Thus, a bond<\/span>\u00a0is <\/span>essentially just<\/span> a debt.<\/span><\/p>\n

In the investment world, a bond is a financial instrument that <\/span>enables you to lend money to a company <\/span>in exchange for regular interest and a promise of repayment. It is a means used by companies or governments to finance their projects.<\/span><\/p>\n

A <\/span>bond <\/span>has <\/span>various<\/span> components:<\/span><\/p>\n