What is the difference between stocks and bonds?

Shares are equity securities that give the right to a part of the company's ownership and participation in its management (for example, voting at the shareholders' meeting). Shareholders can receive dividends — a part of the company's profit.

Bonds are debt securities that represent a loan issued by a company or government. The bondholder receives a fixed income in the form of interest and the return of the nominal value at maturity. Bonds do not grant ownership rights or participation in management.

Main differences:

• Shares are a stake in the company, bonds are a debt.
• Shares can yield dividends, bonds have a fixed interest rate.
• Shares are riskier, bonds are usually more stable.
• Shareholders are owners, bondholders are creditors.