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    Bonds operate quite like a house mortgages. The corporation or government company that releases the bond is thought about a debtor. Investors who buy those bonds, are considered the loan providers. Financiers purchase bonds since they will get interest payments on the financial investment. The corporation or federal government company that issues the bond signs a legal contract to pay back the loan and interest at a predetermined rate and schedule.

    This is the date on which the principal quantity of a bond also known as the "par value" is to be paid completely. A bond's maturity typically is set when it is issued. Bonds typically are described as being short-, medium- or long-lasting. Usually, a bond that matures in one to 3 years is referred to as a short-term bond.


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