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Jack Burton in Mactified Forshion7/02/2009 2:45:00 pm PDT

investopedia.com

The terms “debt” and “borrowing” are used quite a bit.


Bonds are debt, whereas stocks are equity. This is the important distinction between the two securities. By purchasing equity (stock) an investor becomes an owner in a corporation. Ownership comes with voting rights and the right to share in any future profits. By purchasing debt (bonds) an investor becomes a creditor to the corporation (or government).