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How Does the Bond Market Work?

When people talk about the bond market, they’re actually talking about many markets. There are many different types of bonds, bought, sold and redeemed in different places. The three largest examples are the Treasury bond market, corporate bond market and municipal bond market. Any time you purchase a bond from the government or a company, you’re active in the bond market.
The bond market is often considered in parallel to the stock market. While the stock market ebbs and flows constantly, the bond market stays very stable. This is because bonds themselves are stable. They’re among the lowest-risk investments because …read more […]