The difference between bonds and loans
1, different objects.
There is a creditor-debtor relationship between bond buyers or investors and issuers. The debtor is a bond issuer and the creditor is an investor (bond buyer).
Lending means that the lender transfers the ownership of money to the borrower, and the borrower needs to return the same amount of money with interest.
2. The issuers of the two are different.
The issuers of bonds are debtors such as governments, enterprises and banks, but there is no restriction on the issuers of loans, which can be private individuals or institutions.
3, the difference between distribution methods
A bond is a valuable security. Debtors such as governments, enterprises and banks raise funds, issue them according to legal procedures and promise creditors to repay the principal and interest on a specified date.
Lending refers to the bond financing behavior that the bond purchaser borrows the underlying bond from the bond lender with a certain amount of bonds as pledge, and agrees to return the borrowed underlying bond at a certain date in the future, and the bond lender returns the corresponding pledge to the bond purchaser.
What's the difference between bonds and stocks?
1, the legal nature of the difference between the two
Bonds are creditor's rights certificates, and the legal relationship between bondholders and bond issuers is creditor's rights and debts.
The stock belongs to the ownership certificate, the stock holder is the owner of the company, and the shareholders enjoy the equity according to law.
Their legal rights and obligations are different.
Stock holders are members of the company and belong to the shareholders of the company. They all have the right to attend the shareholders' meeting and participate in the company's business decision-making, but they also have to bear the corresponding risks.
The bondholders of a company are only creditors of the company and outsiders of the company. According to the agreed time limit, he has the right to recover the principal and get interest, but he can't participate in the company's operation.
In addition to the above differences, in equity, dividends are paid from after-tax profits, and in creditor's rights, interest on bonds is paid from pre-tax profits.