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Investing & the Stock Market vocabulary · Bonds & Fixed Income

Government bond

Meaning in investing & the stock market, with examples

/ˈɡʌvərnmənt bɑːnd/nounCore term

In investing & the stock market, government bond means: A bond issued by a national government to borrow money, paying interest and returning the principal at maturity. It is often seen as one of the safest investments in its own currency.

In Turkish: devlet tahvili, hazine tahvili, DİBS

How it is used

Each market has its own names: Treasuries in the US, gilts in the UK, Bunds in Germany. News reports follow government bond yields as a guide to interest rates. Bonds issued abroad in foreign currency are often called Eurobonds.

Example sentences

  1. Investors moved into government bonds as stock markets fell.

  2. The two-year government bond yield is now higher than the ten-year yield.

Common collocations

  • government bond yield
  • 10-year government bond
  • issue government bonds
  • government bond market
  • bondA loan that an investor gives to a government or company. The issuer usually pays regular interest and returns the original amount on a fixed date.
  • yieldThe income an investment produces, shown as a yearly percentage of its price. For bonds, it is the return an investor gets if the bond is bought at today's price.
  • corporate bondA bond issued by a company to raise money. It usually pays a higher yield than a government bond because the risk that the company cannot pay is higher.
  • credit ratingA grade given by an agency such as S&P, Moody's or Fitch that shows how likely a government or company is to pay its debts on time.
  • fixed incomeInvestments such as bonds and bills that pay a set amount of interest on a regular schedule and return the principal at maturity.

This word in other fields

The same English word can have a different meaning in another field:

More terms: Bonds & Fixed Income

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This page explains English vocabulary for learners. It is not financial advice.