Corporate Bonds

Corporate bonds are debt securities issued by private and public corporations. Companies issue corporate bonds to raise money for a variety of purposes, such as building a new plant, purchasing equipment, or growing the business.

When you buy a corporate bond, you lend money to the "issuer," the company that issued the bond. In exchange, the company promises to return your money, also known as "principal," on a specified maturity date. Until that date, the corporation usually pays you a stated rate of interest, generally semiannually. While a corporate bond gives you an IOU from the company, you do not have an ownership interest in the issuing corporation - unlike when you purchase the company's stock.

More Information about Investing in Bonds
Callable or Redeemable Bonds
Corporate Bonds
Municipal Bonds
Selling Your Bonds Before Maturity
What if You Are Late in Receiving Your Interest Payments?