Why are bonds less riskier than stocks?

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Why are bonds less riskier than stocks?

In: Economics

4 Answers

Anonymous 0 Comments

All debt includes unconditional payments. The borrower has to pay you back, often in set contractual installments.

Equity, on the other hand, does not have this. The company borrowing your money has no obligation to pay you back every year. So you could not see returns for years.

This is why debt is less risky than equity

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