The Ins and Outs of Investing in Corporate Bonds - Video

Corporate bonds are an investment instrument that pays higher rates than government (or municipal) bonds due to the increased risk of loss to bondholders. They have a wide range of conditions because the financial health of the issuers can vary greatly. Each company is different and has a different likelihood of defaulting on their obligations; however, they all use bonds for one reason: to raise money. What Are Corporate Bonds? When a corporation wants to raise money for some type of investment or expenditure, they have three basic choices.