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25 July, 17:25

What is the difference between buying shares of stock and buying bonds

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  1. 25 July, 20:33
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    See explanation section

    Explanation:

    The difference between buying shares and buying bonds are as follows:

    1. Buying stock gives a person to own the company while buying a bond that provides a person to become a debt-holder of the company who can receive interest and get the entire amount in the future.

    2. Purchasing stock gives an individual the voting right to elect the board of directors of a company. Buying bonds does not give voting rights to the bondholders.

    3. Stock owners can receive the profit in the name of dividends. Bondholders do not receive any profit. Instead, they receive interest annually.
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