What is the basic idea behind bonds in finance?
I’m struggling to understand the basics of financial bonds and can’t find a really basic explanation anywhere.
Tags: basic, behind, bonds, explanation, Finance, financial bonds, Idea
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June 6th, 2010 at 9:42 pm
Your Accounting GURU Here!!!
Corporate Bonds are Long term debt instruments: They are used to raise capital (cash) to expand a business.
June 6th, 2010 at 10:35 pm
The basic idea is that a company that doesn’t have enough cash to do what it wants to do issues bonds to generate cash. The people who buy bonds receive a percentage return on the amount of cash they have provided and after a set period, the person who bought the bond gets their money back.
Wikipedia has a decent explanation.
November 7th, 2011 at 10:04 pm
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