What is the difference between buying stocks and bonds?

Stocks and bonds are both types of securities that can be bought and sold on financial markets, but they differ in several ways:

Ownership: Stocks represent ownership in a company, while bonds represent debt that the company owes to investors.

Returns: Stocks offer the potential for higher returns, but they are also riskier than bonds. Bonds offer lower potential returns, but they are generally considered to be safer investments.

Income: Stocks may pay dividends to shareholders, but these payments are not guaranteed. Bonds, on the other hand, typically pay interest to investors at a fixed rate.

Voting rights: Stockholders are entitled to vote on certain company decisions, while bondholders do not have voting rights.

Overall, stocks and bonds are different investment options that offer varying levels of risk and potential return. It's important to carefully consider your investment goals and risk tolerance before deciding how to allocate your assets between these two types of securities.