A stock is a share of ownership in a company, whereas a bond is a debt instrument with a set interest rate, time frame, payment intervals and principal payment at the end.
Risk and reward are key with stocks and bonds. Stocks are riskier, with the reward greater, as well as the possible loss. Bonds make consistent money and you tend to get some back if the company doesn’t fare well.
Stocks and bonds are risky investments, but it’s important to know their uses.