Dive into the fundamental machinery of the debt market in this comprehensive guide to bonds. We explain how a bond functions as a formal security where an issuer—whether a government, municipality, or corporation—borrows funds from an investor in exchange for cash flow, typically involving regular interest payments known as coupons and the repayment of the principal at a specified maturity date.

In this episode, we cover:

• Bonds vs. Stocks: We clarify the distinction between holding an equity stake as a stockholder versus holding a creditor stake as a bondholder, noting that bondholders generally have priority over shareholders in the event of bankruptcy.
• The Mechanics of Debt: Learn the definitions of key features such as yield