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[QUOTE="Jasmine, post: 264496, member: 49159"] The correct term for this is corporate bonds and it works similar to government bonds, security deposits or treasury bills. When a company wants to raise funds, they offer corporate bonds. These corporate bonds offer certain interest rate for the buyers and the minimum term for these bonds are at least one year. People can buy these corporate bonds, and earn interest on their investment (the bonds that buy). This works just like fixed deposit bank account. You deposit certain amount of money for a fixed term and receive higher interest rate. You can also use your corporate bond as collateral if you want to get a loan from the banks. However, there is also a risk of buying corporate bonds because the company might not be able to payback because of its bankruptcy. If you are interested in buying bonds, you should choose government bonds instead as government is less likely to cheat on you. [/QUOTE]
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