Difference between Bond and Loan

Nov 30 -0001

Distinguish, differentiate, compare and explain what is the difference between Bond and Loan. Comparison and Differences.

Differences between Bond and Loan

S.No.	Bond	Loan
1	Bonds can be sold by governments or firms.	Loans are taken out by firms and consumers looking to borrow money.
2	Interest rate are usually fixed on a bond for the period of bond.	Loans can be of fixed rate, but often are variable - changing with basic rates.
3	Bonds can be sold on bond market to public / financial institutions.	Most loans are given by banks.
4	Bonds are often bought and sold on bond market. Value of bond can go up and down.	Loans are usually fixed with original bank.
5	Examples: 10-year US Treasury bond.	Examples: Variable bank loan.
6	Govenment bonds yields likely to be lower interest rate and are seen as safe investment.	Bonk loans on unsecured lending can be quite high.