What is the difference between stocks and bonds?

Before we review five areas of how stocks and bonds are different, let’s define what is a stock and let’s define what is a bond.

⏱️TIMESTAMPS⏱️
0:00 Definition of stocks and bonds
0:56 How bonds work
2:53 Possible returns on stocks
4:38 Skills needed to invest in bonds
5:22 Skills needed to invest in stocks
6:01 Bonds vs stocks in bankruptcy
7:25 Regrets when investing in bonds
8:03 Regrets when investing in stocks

A stock is a type of investment that represents the ownership of a fraction of a corporation. As in: here’s the part that I own of the company in red, versus the part that all other shareholders own in blue. Don’t see any red in the picture? Look very closely, it is a tiny tiny little slice.

Bonds are different. A bond is a loan from an investor to a borrower such as a company or government.

So what can you expect when #investing in #stocks versus investing in #bonds. Let me tell you the story of five key areas where the investment experience can be wildly different.

Philip de Vroe (The Finance Storyteller) aims to make accounting, finance and investing enjoyable and easier to understand. Learn the business and accounting vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better investing decisions. Philip delivers #financetraining in various formats: YouTube videos, livestreams, classroom sessions, and webinars. Connect with me through Linked In!

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