Economy, Business and Investment

Stocks and bonds is an investment tool that can generate wealth. Both are sometimes considered to be the same. In fact, there is no difference at all. But in fact, stocks and bonds have significant differences. For that, let's try to peel the difference of stocks and bonds to expand the horizons will be two means of this investment in order to determine the right choice of investment you want done.

Form
Based on the shape, the form of proof of ownership of shares of certain companies. If you own shares, meaning you can be said as the owner of shares held firm with them. Unlike with stocks, bonds form of evidence of debt instruments. In this case, you have proof that the company owes you the amount stated in the bond.

Income
Shareholders have called the dividend income with the income that is not specified frequencies. The owner of the bonds earn a specified interest rate within a certain period stated in the corresponding bonds.

Profit
The advantage gained by the shareholders is difficult to estimate because the benefits depend on corporate profits. In fact, if the company is a loss, shareholders can also lose money. As with the stock, bond owners have the advantage that can be calculated with certainty.

Price
Stock has a price unpredictability. Sometimes, a high price, but not infrequently also has a low price. It relies on the development of the company itself. Meanwhile, bond prices tend to be stable, although highly sensitive to interest rate and inflation that occurred.

Time
Based on the time, the stock has an unlimited period of time. No determination until when you have a stake in the company. Bonds himself as an accounts receivable agreement that has a period of time. Clearly determined when you can collect or the company will refund your money which is used as capital in the company.

Tax
For shareholders, the net benefits because it is taxed. While the owners of the bonds, the benefits still have to cut taxes so that taxes can also be calculated in advance before the bonds are paid the company.

Right to Vote
Shareholders have voting rights that must be heard in determining company policy because of its status is the owner. Bond owners have absolutely no right to vote to determine company policy. He only lend money. After that, off. The most important part for the bond owner is a company pays on time with payments in accordance with the appropriate time and appropriate bond.

Liquidation
If the company where you plant stock liquidation or dissolution of the company, owners of the bonds have inferior claims, he has the right to share the remnants of the dissolution of the company that has been done. Here, the division is not a company priority. Meanwhile, owners of the bonds acquired rights of claim against the assets owned by the company according to bond. Bondholder priority in the ownership of the company's assets.