How do I make or lose money from a bond?
- You get a set rate of interest for lending your money. This is called the coupon rate of the bond.
- Some investors sell their bonds before they reach their maturity date. Sometimes you will make money and sometimes you will lose money doing this.
Sound complicated? It can be. Many people use an adviser to help them decide which bonds to buy and when to sell.
Tip: Savings bonds, such as Canada Savings Bonds (CSBs), do not work the same way as other government bonds and corporate bonds. Learn more about CSBs.
Remember: When you buy a bond, you're lending your money
Be careful whenever you lend money. After all, you want to be sure you'll get it back.
Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.