For alternate meanings, such as chemical bond, see Bond disambiguation.
In bankruptcy, bondholders are paid before short term creditors including workers who are owed wages and all creditors must be paid in full before owners receive anything. Market indices exist for dedicated investors in the market. Bonds are long-term loans secured by property rather than short-term loans secured merely by the debtor's promise to pay.
Interest paid to bondholders receives preferential tax treatment compared to dividends paid to shareholders. Each country sets its own rules for issuing and redeeming short and long-term debt and stock. High-yield bonds with a correspondingly high risk are sometimes known as junk bonds.
Bonds can also carry "put options", which allow the investor to sell the bonds back to the issuer at a date specified when the bonds are sold to the investor. Government bonds "sovereign bonds", are issued by national governments. For alternate meanings, such as chemical bond, see Bond disambiguation.
Municipal bonds are issued by local governments in the US.