Debt Instruments

Debt instruments are financial tools used by organizations or governments to borrow money from investors. When you buy a debt instrument, such as a bond, you’re effectively lending money to the issuer for a set period. In return, the issuer promises to pay you interest regularly and return the principal amount at the end of the term. These instruments help entities raise funds for projects or operations without giving up ownership, and they provide investors with a steady income stream and relatively lower risk compared to stocks. Examples include bonds, notes, and certificates of deposit.