EDPUZZLE: Investing Basics: Bonds

Just as you might loan money to a friend, you can loan money to a government or corporation through a bond. Bonds are one of the most common investment options available to you. Watch this video to learn more about bonds and follow your teacher’s directions to answer the questions in your student activity packet.

INFOGRAPHIC: What are the Main Types of Bonds?

As you learned in the previous video, you can buy a corporate bond or a government bond. There are different types of bonds within these two categories as well! Read through the infographic on this page to learn about the different bond types. Then, answer the questions in your student activity packet.

INFOGRAPHIC: The Bond See-Saw

VIDEO: Back to Basics: Understanding Yield and the Effects of Rising Rates

If you buy a bond and hold it through its maturity date, the ups and downs of the bond market will not impact your investment. However, if you decide to sell a bond before its maturity date, you need to understand how the current market’s interest rates impact the price of your bond. Read through this infographic and watch the video to learn more about this relationship.

VIDEO: Individual Bonds vs. Bond Funds: What’s the Difference?

When investing in bonds, most investors choose to invest in bond funds, rather than selecting individual bonds. Watch this video to learn about bond funds and how they differ from bonds. Answer the questions in your student activity packet.

Learning Targets:

• I can explain what a bond is and the pros and cons of investing in bonds.
• I understand the various factors that can influence bond prices such as interest rates.
• I can identify the differences between an individual bond and a bond fund.