How is corporate bond different from fixed deposit | Vested

How is a Corporate Bond different from Fixed Deposit?

Corporate bonds and fixed deposits are both fixed-income investments, but they differ in several ways. Corporate bonds are debt securities issued by companies and their returns are dependent on the issuing company's creditworthiness, offering potentially higher yields but with some level of risk. Learn about the risk of investing in corporate bonds.Fixed deposits are savings instruments offered by banks and come with lower risk, as they are usually insured, offering predictable, lower interest rates.


    • Related Articles

    • Does Corporate Bonds pledge any asset as collateral?

      Corporate bonds can sometimes be backed by specific assets, which are pledged as collateral. These are known as secured corporate bonds. When a company issues secured corporate bonds, it pledges certain assets, such as property, machinery, inventory, ...
    • What are the different types of INR Bonds available on Vested?

      There are two types of INR Bonds available on Vested: Corporate Bonds: Issued by private companies with good credit ratings, corporate bonds offer higher potential returns compared to G-Secs and PSU bonds, but also carry higher risk. The ...
    • Does INR bonds have high liquidity similar to other asset class (like stocks, MFs, FDs, etc.)

      Bonds typically have lower liquidity compared to assets like stocks and mutual funds. While bonds are more liquid than fixed deposits (FDs), they may not be as easily tradable as stocks or mutual funds due to the bond market's structure. However, the ...
    • What is the difference between Coupon rate and Yield?

      The Coupon Rate represents the fixed annual interest rate a bond pays based on its face value. In contrast, Yield refers to the total return an investor can expect from a bond, considering its price, coupon payments, and maturity. Yield accounts for ...
    • What are the possible risks associated with Bonds?

      While bonds offer a generally low-risk compared to equity investments, there are still potential risks to consider, a few of those include: Interest rate risk: This is the biggest risk for all bonds. If interest rates rise after you've purchased a ...