Financial Markets Association Tag's Archives
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A bond is a loan. It’s nothing more than a fancy IOU in which the terms, pay-back date and interest rate are carefully spelled out in a legal document.
It’s like in any relationship, it’s a promise made by both sides. In business term, it’s an approach in finance. When they need something today, they promise to pay for it at some point in the future. And those promises are called bonds.
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