Bond holders get interest. When the bonds mature, bond holders are paid their principal back (unless the bond issuer goes bankrupt). If the bond holder wants to sell the bonds before maturity, the price they get for the bonds may be more or less than what they paid.

Types of bonds: Govt Bonds

Bond prices fluctuate -- so investors may lose money if they sell them before maturity.

Bonds pay coupon (interest)

If interest rates go up, bonds lose value

If inflation goes up, interest rates go up.

Federal Reserve (Central Bank) controls money supply.

Economic activity increases demand for capital, labor, and commodities.

• Bond Basics
• Advanced Bond Concepts
• Bond Rotation Strategy