Introduction to bonds | Stocks and bonds | Finance & Capital Markets | Khan Academy
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- Опубліковано 27 вер 2013
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What it means to buy a bond. Created by Sal Khan.
Finance and capital markets on Khan Academy: Both corporations and governments can borrow money by selling bonds. This tutorial explains how this works and how bond prices relate to interest rates. In general, understanding this not only helps you with your own investing, but gives you a lens on the entire global economy.
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*ROCHELLE DUNGCA-SCHREIBER* is my portfolio-coach, I found her on Bloomberg where she was featured, I looked up her name on the internet. Fortunately I came across her site and reached out to her, you can verify her yourself.
🎯 Key Takeaways for quick navigation:
00:00 🏢 A bond allows an individual to be a partial lender to a company.
01:28 📈 Companies can either finance growth by issuing more equity (shares) or borrowing money (issuing debt).
02:55 💸 Borrowing doesn't dilute company ownership, but borrowers must be paid interest before shareholders see profits.
04:53 📜 Bonds are certificates issued by companies to raise funds. They state the face (or par) value, interest rate, and maturity date.
07:18 ⌛ Bond interest payments, called "coupons", are typically paid semi-annually, with the principal returned at maturity.
Made with HARPA AI
I still didn't really get how the bond payments worked when including the interest.
Great video. I watch several youtube videos on how to trade in the market but haven't made any headstart because they are either talking some gibberish or sharing their story of how they made it and I do not want to make mistakes by taking risks in my own hands
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Katrinasusan I the name to look for
As a first time investor I started trading with katrina susan with just a thousand bucks. my portfolio is worth much more than now within just weeks of trading with her
Lol you got me through my physics courses for engineering, didn’t know you did Accounting too 😂 god I love you. May you be blessed and wealthy
you deserve a raise......
Thank you Mr.Khan, your videos are the primary reason why I am surviving college
@@farnandezluis1872 bad bot
Work with Helen Howard pratea on google if you are finding it difficult , she is an expert advisor
I appreciate this gentleman, smart and passionate about learning and teaching.
Phenomenal explanation❤
This video can’t be more clear! It’s preety good, I love it
Hi
This is amazing just to realize how things around work. The information is gold.
Fax
Well explained. Much much appreciation
Khan Academy...fantastic!!! well understood.Brief and easy to understand. Many Thanks
you are one awesome khan !
Thank you!
I cant believe i didnt get this in college but now after watching this, I do.
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
GOD BLESS YOU SIR
Thank you so much for this. it's so good to finally understand bonds.
awesomeness !!
superb sir
Dividends are nice. Personally, I sometimes use my dividends to buy other dividend and growth stocks for diversification instead of reinvesting in the same stock. To each their own methods though. The good thing is that you’re investing in the first place and that’s what’s important. Salute for the content!
The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner
the best market strategy is to work with a credible investing coach. Since a while ago, I've been in touch with a coach, mostly because I lack the depth of understanding and mental toughness to deal with the ongoing market conditions. You lack the information necessary to succeed in a competitive market, not because you're doing anything wrong, but rather because of your lack of experience.
That does make a lot of sense, unlike us, you seem to have the Market figured out. Who is this consultant?
‘Sonya Lee MItchell’ is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Great Video!
Thank you I’m only just starting to learn about this
thanks for the bonds for dummies (me being the dummy)
FINALLY....... I understand
wow i completely learned something.
Let's always do alot of good 🔥
Thanks a lot pal
Big ups to everyone working effortlessly trying to earn a living while building wealth. I am 50 and my wife 44 we are both retired with the net worth of over $3million with no depts. Currently living smart and frugal with our money. Saving and investing lifestyle in the financial market made it possible for us this early even till now earn monthly through passive income.
Not quite long I started investing. I'm very curious and need help on how to enhance and increase my returns. Any good investment tips would be appreciated.
@@alyciagordon3447 Generally, investing requires higher knowledge. For this reason, It's important to have a solid support structure (financial consultant) to guide you through especially in asset picking. I operate with (Alexandra Diana Jose) a consultant who partners with a licensed wealth management firm. For the record, the experience has been the best for my finance. She made me financially stable investing through her help, now I earn on a monthly basis through her passive income strategy... So I'd advise you do get a good investment advisor for yourself.
@@davidreus9321 please how do i get in touch with her
Impressive. Would you mind sharing some more details. I’d like to have a talk with her.
@@alyciagordon3447 She is easy to find , make a quick research of her on the internet with her name Alexandra Diana Jose . She works with anyone independent of their location.
Tnx for this info, I just looked up your investment professional and found her page. Her experience is pretty impressive. I wrote her and I'm waiting on her reply.
GRABEEE NGAYON KO LANG NAINTINDIHAN, SUPER THANK YOUUUUU
This video is top tier
you are a very good teacher, made this very simple to understand.
really helpful , thanks ...
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
the best clearest video out there. most introduction videos dont even tell you how much you receive as the holder of the bond and just segue into a flurry of complicated information. more videos need to take it step by step like this and explain exactly how each entity of the party makes money and the reasons behind it. well done
Amazing!
The name is Bond, James Bond.
more like debt...Bond Debt.
Pfff everyone makes the same joke, during the first lecture about bonds lol
Lmao
You mean the name is sal and he is a god!
thank you
Thank you guys....you the best
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Awesome explanation
Finally I got something about this. Thanks !!
This video is great!
He has a nice voice
what software or what programme is used in above video .,, I too want to use it for presentations in my colg
Thank you.
That was!... That.. Was... That was a pretty good! A.. Pretty.. Good.. A pretty good... Video!... Video... Vi.. De.. O.. Video
OMG! Thanks for aiding to my PIVD induced leg pain...HAHAHHAA
He's prob...probably...laugh....laughing....t...to...the....the...ba...bank...bank.
Repetition is key lol
Nano Taleb why? Why? Why? Why? Why? Why? Why?
You the man!
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Thank you
thanks so much for the video. without your series, I couldnt pass any subject related to finance and statistics :( thanks again!
In which degree programs do you study
So for a series 1 bond via treasury direct, you simply purchase the bond/deposit the money and that’s it?
Freaking thank you!! I have read already 3 whole academic books, been to multiple classes, several teachers, and a lot of power points and such. Your video finally helped me!!!!!
Work with Helen Howard pratea on google if you are finding it difficult , she is an expert advisor
Beautifully explained bro
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
nice
ok, i see now what this means = i can control the universe with this "interest"
This may be a dumb question but would appreciate if someone could help me understand - if a company is able to issue and sell stock to raise $ then why would they want to go into debt as an alternative? Overall, debt is not a good thing but being able to raise $ through selling something seems like the better alternative. I'm sure I'm missing some critical info here so if anyone could help, I'd appreciate it. Thank you!
The advantages of issuing bonds over stock are:
1/ Bondholders do not have voting rights and cannot share the companies' earnings.
2/ Interest expense is tax deductible, but dividends are not
3/ Money can usually be borrowed at a lower rate and then invested to earn a higher return on assets.
Of course, issuing bonds comes at a risk since the company is in debt. However, there are certain advantages to doing so, as I mentioned above.
great job sir,,thanx
Thank you leafy
But if the company issues new shares the value of a share drops doesn't it ?
Thank you so much Khan Academy! You made topics in finance and capital markets easy to understand!!! As topics relating to finance and capital markets are not being covered much in my uni I was kind of clueless about how mutual funds work, how bonds work, interest rates, etc. You have explained everything in layman terms and I'm so happy! Please keep up the good work!!👍😁
Ok that helps!
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Thank you 🙏🏻 ❤️❤️.. This is so helpful ✨
Sir plz provide lectures in Hindi also
Pl try Khan academy India or Hindi
Hey guys, I just have a problem regarding the first scenario. If the company has an equity valued 10 million and 1 million shares going at 10 bucks a piece. How can they give 500,000 shares, ipo? And is the 1.5 million valued equity, after the ipo?
Just new to this
I use khan academy for school and clicked on the video randomly and was like *I KNOW THAT VOICE.* lol
I don’t understand 😭😭😭 i was doing well but then idk what happened when ge started with issuing bonds
Best explanation about Bonds out there!
Thanks Sal!
I will recommend debentures at youthful ages while bonds and sticks at 50's and above.
However for your best full-time bonds broker services at cheap rate, I recommend Marie Williams, a verified broker known currently in the states.
However for your best full-time bonds broker services at cheap rate, I recommend Marie Williams, a verified broker known currently in the states.
thank you very much. This cleared up a lot of questions I had.
Company can sometimes buy back the bonds when market rates are low and re-issue (in a sense they can refinance the loan)
Holy crap i'm only 14 and I understand thanks so much
Great video! Definitely answered any questions I had!
I never really understood what a bond meant during my eco class, so thanks alot.
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
How do bonds keep up with inflation?
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
So companies can sell equity that they actually don't have? Where would the $5m come from and how would they get people to buy shares on it?
Mick C I’m having the same problem.I just have a problem regarding the first scenario. If the company has an equity valued at 10 million and 1 million shares going at 10 bucks a piece. How can they give 500,000 shares, ipo? And is the 1.5 million valued equity, after the ipo?
@@tashidorjipelbar4321 Once every single one of the 500,000 new shares that were issued are bought, the money from the new shareholders are added to the assets so there is still a $10 for every share ratio going on. People do this in hopes that the money they're lending to the company will bring them a profit later on if company does well and the stock price goes up.
@@ryanross7785 Thanks, I see now...so the assets increase to $15m, the shares increase to 1.5m, and we still have $10 per share. I guess the question then is, what is the risk here? Why would a company continue to finance themselves this way such that they can keep investing in growth. I suppose there is a limit to the people who will buy shares, or maybe more shares/assets require more returns?
Edit: Never mind, he goes on to explain it in the video. More shareholders means splitting the profits amount more people.
khan academy always comes through
Very good video although a bit slow...
Thank you so much for your video 'Sir'. I didn't understand in my class about bond but I did understand from your video. Could you please explain about mortgage loan?
Thanks
Thank you for the video. It was easy to understand. 감사합니다. ^^
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Amazing so its just as simple as borrowing your car xD
How can you issue new shares without diluting the other shares?
+David Lewis Because you're increasing the amount of assets aswell.
when you calculate the profits happened for that financial year, last year your asset including profit would be 50 billion dollars and this financial year calculating the launches and profits made from it the profit goes up and its 90 billion dollar, suddenly jeff Bezos is the richest man on eart, stock prices go up now ppl are buying it all over, tommorow someone tweeted something bad abt the company and the reputation dropped and ppl were afraid that customers wont buy anymore frm this company lets sell this stock, the entire process happens in reverse, now the asset goes down and stock value goes down also! BOOM jeff is no more the richest man in the world!
David Lewis when the company issued the new shares, the share amount jumped to 1.5 instead of 1 million shares. Therefore, they were diluted
Hi, what sort of a gadget did you use to produce a video like this? Is it some sort of a writing tool?
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
kindly do upload more videos on derivatives
WHY ARE U SO QUIET KING, SPEAK UPPPP THAMNKS
thank you,very well explained
So when a bond matures it must be paid back? And will that payout be the same as the original purchase price or is the payout price of the bond subject to change during the life of the bond?
its been 9 months and this is the only response im asking the same lol
but that means that the first million shareholders get less money because there are 500k extra shareholders.
How do I find bonds to invest in
On your brokers. Be careful when you invest :)
The handwriting made the video so much easier to watch haha
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Dude! I need some of this bOnDs to cover my student loan lol!😂
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
hood
I thought one would get payed more from semi-annually than annually.
this is the only time that i understood bonds principle among many which drained my brain, this was the best ever, does the tutor have other videos for other bonds calculations?
You do not take into account share price dillusion for issuing new shares???
So every 6 months you have to pay out 25k? seems risky
fleshcookie wut
Very well explained...thanks a ton..:)
Bonds are often overlooked by a lot of investors. They tend to be overshadowed by stocks. The topic of bonds get covered quite nicely in Security Analysis which I'm covering on the channel. Super nice introduction to bonds!
Wait how much do you know exactly?
It has not been easy for me since I started investing in forex trading, I have work with many traders due some are good but the lose is greater than the gains but since my friend introduced me to Mr Charles forex trading i have never loss any trade now I really know that forex trading is really profitable and reliable.
With the help of Mr Charles I no more bother about financial issues you can reach him on this mail.
((Charlesclinton877@gmail .com
Volume needs to be improved!
Dear Mr. Khan really thanks for making the videos I really enjoyed and learned a lot from these videos. I just have a quick question about the first 3 minutes of this video, why the share holders would agree on reducing their share of the company? lets say I own 50% share of the original asset, then by issuing extra stocks which generating 5M cash, my share will drop to 33%. Is it because the total earnings of 33% and 50% would be the same, by investing the extra 5M? what is the thought behind this concept? Again I really enjoying these programs thanks in advance.
The shareholders don’t really have a choice, which is why when stocks issue new shares the stock price usually drops to reflect that. However, issuing new shares can be beneficial to the current shareholders over the long term because the company can invest the capital it raised from the new shares and increase their earnings
Ok
Great video helped me understand a lot, thank you.
Are senior notes bonds?