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What are the characteristics of Bond.

Bond=

Bond is that type of Certificate which is issued on the basis of interest usually issued by Government or any corporation for the purpose of raising money. The owner of the bond receives fixed amount announced with the bond details for the given period of time.

Characteristics of Bonds=


Besides the type of bonds, Following are the characteristics of the bond:

There are short term and long term bonds


  • Short term bonds are repayable for less than one year and more than one year after the date of issuance.

  • Long term bonds are repayable for more than five years, ten years and thirty years after the date of issuance of the bonds.

  • Face value of the bond is payable to the bondholders at the time of maturity.

  • Serial bonds are those whose maturity dates are different from each other.

  • Bond indenture is the term used for the bond contracts.

  • Bond issuer pays interest according to the conditions decided on the contract.

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