Your Gateway to Financial Literacy
Introduction to Bond Prices and Market Interest Rates Bond prices and market interest rates are inversely related; as interest rates fall, bond prices generally rise, while rising interest rates cause bond prices to decrease. The relationship between bond prices and yields is essential to understand since it impacts the overall
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What Is a Bond? A bond is an essential debt instrument used by various entities—including corporations and governments—to borrow money from investors. In essence, a bond functions as an I.O.U. between the issuer (borrower) and the investor (lender). These fixed-income securities are considered one of the primary asset classes alongside
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