If buying stocks means you own part of the company, then what about bonds?

Question

Buying bonds also means you own part of the company just that it works differently?

Which would be best?

Answer 1

Buying a bond means you made a loan to the company. Bonds are debt. There are different kinds of bonds. Some pay a fixed rate of interest, some pay a floating rate. Some bonds dont pay interest. They're bought at less than than the face value and pay the full face value amount at maturity, Stock is equity. It means you own a part of the company.

Answer 2

Buying bonds means you lend money to the company. The only time you can get a piece of the company is when the company goes bankrupt. Otherwise, you'll get the interest rate as agreed.

Answer 3

Stock is part ownership in the company.
If the company does well, the value goes up.
There can also be dividends, (part of the profits).
The value fluctuates with the market and business conditions in general.

Bonds are debts of the company.
There is a fixed rate of interest or payout at maturity.
Unless the company goes bankrupt the bondholders are payed.
(Sometimes even then).
With 'good` bonds the value fluctuates only with interest rates.

Answer 4

I have been told that owning stock meant that you own the right to a piece (i.e. proportional to the number of shares you own) of a company's future earnings.

Is that synonymous with "owning part of the company"?

I don't get corporate law all that well. To me it seems to be more of an oligarchy than anything else. Some people on the board of directors might not even own company stock while others not on the board own many shares? My $0.02

Answer 5

Bonds means that you are lending money to the company. This means that you are a creditor to the company.

Answer 6

Bond funding is a group making a loan. The loan is paid off with interest back to you according to what you have invested.