A bond is a fixed income instrument that represents a loan made by means of an investor to a borrower (typically corporate or governmental). A bond ought to be concept of as an I.O.U. between the lender and borrower that includes the details of the loan and its payments. Bonds are used by companies, municipalities, states, and sovereign governments to finance projects and operations. Owners of bonds are debtholders, or creditors, of the issuer. Bond details include the end date when the principal of the loan is due to be paid to the bond proprietor and typically includes the phrases for variable or fixed interest payments made by the borrower.
Key Takeaways

Bonds are units of company debt issued by companies and securitized as tradeable assets.
A bond is referred to as a fixed income instrument considering bonds historically paid a fixed interest rate (coupon) to debtholders. Variable or floating interest fees are also now pretty common.
Bond prices are inversely correlated with interest rates: when fees go up, bond prices fall and vice-versa.
Bonds have maturity dates at which point the principal amount should be paid back in full or chance default.