Bonds have been around for a long, long time and are one of the most basic financial instruments.

A bond is an interesting-bearing certificate, and pays out a fixed rate of interest over the time period that the deby is held. This is what makes it a fixed income security.

The issuer has to pay the fixed sum to the person who lends them the money (buys the bond), and this can be paid in various different ways - for instance one off at maturity or otherwise, perhaps annually.

The maturity date of bonds is commonly five years or more; ten years plus are not uncommon either.

There are also a range of more complicated products such as convertible bonds.

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