A bond is a financial debt instrument issued by companies, governments, public utilities and other large organizations at a fixed interest rate for a specific period of time.

At the end of this specific period of time or during predetermined intervals, the owner of the bond is paid a fixed amount that was agreed to when the bond was bought.

Bonds are issued for the express purpose of raising funds for things such as business expansion, and/or short-term or medium-term costs and expenses being incurred by the issuer.