They return a little more than Treasuries but are a bit riskier. Corporate bonds are provided by business. They have more risk than government bonds since corporations can't raise taxes to pay for the bonds. The danger and return depend on how credit-worthy the company is. The highest paying and greatest threat ones are called junk bonds.

Till then, the debtor makes agreed-upon interest payments to the bondholder. People who own bonds are also called lenders or debtholders. In the old days, when people kept paper bonds, they would redeem the interest payments by clipping discount coupons. Today, this is all done electronically. Naturally, the debtor pays back the principal, called the face worth, when the bond develops.

They can only do this due to the fact that there is a secondary market for bonds. Bonds are either openly traded on exchanges or sold independently in between a broker and the financial institution. Given that

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