A financial instrument whereby a company or government borrows money and promises to pay interest on the loan. The bondholder is a creditor, not a share-holder.

A certificate of debt which: (1) represents a part of a loan to a business corporation or governmental unit, (2) bears interest, and (3) matures on a stated future date. Infrequently a bond issue may fail to possess one of these characteristics. Short term bonds (generally running for five years or less from date of issuance) are often called notes.