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"More on bonds. (The
investment, not the baseball player.)"
Bonds can be classified by issuer - either governments or companies. The U.S. government issues treasury notes, treasury bonds, and savings bonds. Local governments issue municipal bonds. From the business sector come corporate bonds, and their higher-risk counterparts, junk bonds.
Bonds can be classified by maturity -- short-, medium-, and long-term. You can match a bond's maturity (or when it comes due) to a time horizon you may have.
unds to repay its "loan" sooner. This is good for the borrower, but not necessarily so for you.
You can sell a bond before it matures, but it might be hard to find a buyer, especially if interest rates have gone up since you bought.
Bonds also can be classified by credit quality - AAA (safest)
to D (riskiest). To find out how much investment risk a specific
bond poses, check with an objective source. Independent rating
agencies such as Moody's and Standard & Poor's predict a bond
issuer's ability to repay.
Read more about bonds.
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