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The fundamental differences between the various types of bonds that exist or are issued in the market. There are two types of bonds that dominate the market: Government bonds and Corporate bonds. Although they appear to be identical, they actually have significant differences.
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Government Bonds Corporate Bonds Government bonds give less yield returns than corporate bonds because the risk in these instruments is lower. Government bonds are considered as one of the safest investment options because they carry sovereign guarantees. Government bonds are generally issued for terms ranging from 5 to 30 years. Since it is a long tenure, it loses its relevance. Government bonds are generally issued for terms ranging from 5 to 30 years. Since it is a long tenure, it loses its relevance. The government pays interest on the face value of the bond annually. The government pays interest on the face value of the bond annually. Government bonds are considered as one of the safest investment options because they carry sovereign guarantees. Government bonds give less yield returns than corporate bonds because the risk in these instruments is lower. Government bonds are issued by the central/ union or state governments to fund various government projects. Government bonds are issued by the central/ union or state governments to fund various government projects. 5. 5. 4. 1. 2. 3. 3. 4. 2. 1.
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