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Bonds that require payment of the full principal at a single maturity date are known as term bonds.
How will you describe term bonds?
An expiry date is a feature of a term bond. Due to their set maturity dates and lesser risk than traditional bonds, they provide you with the chance to invest in bonds at lower interest rates. Term bonds are often issued by state or municipal governments, although some businesses also do so for retirement savings schemes for their employees.
How Are Term Bonds Operated?
There are typically two methods to purchase bonds issued by businesses and governments: face value and market value (also known as "par"). Bond prices are intimately correlated with interest rates, so as rates rise, bonds sell for less money, and vice versa. Investors have the option of reselling their normal bonds on the market. Term bonds may be the ideal option if you're seeking for a secure investment because they feature lower interest rates than conventional bonds. Investing in high-quality bonds with little risk is also possible with term bonds.
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