Bonds

A bond is represented as a loan from an investor to a borrower; such as a company, government, municipalities, bank etc
They are typically used by the borrower to fund their projects and operations
Owners of the bonds are called debtholders/creditors and receive a certain percentage of interest from the borrower based on the bond price per year

Provides an income stream that is easily predictable in many cases; although this depends on what type of bond you buy
Potential of earning higher rates of return than a benchmark bank fixed deposit profits; although this only applies for corporate bonds and depends on which company your bonds are in

There are 2 primary bonds:
Corporate Bonds: a bond issued by a credit holder to a company, the borrower. The borrower funds their projects, etc and in return pays to the credit holder; pays an annual interest of about 5% to 9% of the bond price until the full amount is given and the payments cease
Government Bonds: like a corporate bond, except it is issued to the government. They will also pay an annual interest of about 7.5% of the bond price until the full amount is given where the payments will stop

Understand: bonds are easy to understand as you give a certain sum of your money which they use for their operations, however will also pay you a certain amount of interest based on the bond price
Buy and Sell: bonds can easily at the creditor’s request depending on the price
Passive Income: bonds are an easy source of income as you receive your interest annually, however until the full amount is paid

Risky: very risky investment and you can lose your money completely if the borrower makes losses; only for corporate bonds
Bad Against Inflation: bonds fall if interests go up due to inflation; also happens if companies make losses too (however in government bonds, you will be compensated with the equal amount)

Bonds issued by the government are the safest as there is little risk, since they will compensate for any losses; (however government bonds give less interest)
Because of this, you should not invest all your money in one bond, but be diverse and invest in both depending on your appetite for risk
Bonds are rated by credit rating agencies from AAA to DD

Invest your money in both corporate and government bonds, use the rule of 100 to help you decide which bonds to invest in
Read carefully which companies to buy corporate bonds in; check their credit rating, past and future rate of returns, number of sales etc before doing so
Buy bonds when the price is low, and sell when prices are high
Always monitor how much interest you are being given, and by when