Investing in bonds has the following advantages and disadvantages when compared to investing in shares: (Artist: the following are to be tabled in the format as on website)

Advantages

Disadvantages

Investor receives periodic fixed (or variable) interest income, irrespective of whether the company issuing the bonds is doing well or not.     Bondholders have a prior right over ordinary shareholders on the distribution of earnings and on claims in the event of bankruptcy.

As the income (coupons) derived from bonds is stipulated, the investor does not get paid more even if business is booming as in the case of ordinary shareholders who may be given higher dividends.     Bondholders have no voting rights and are not owners of the company while shareholders have a right to vote at general meetings as owners of the company in accordance to the number of shares they hold.