Community Forex Questions
What is the business risk?
A stock is a piece of ownership in a company that you can purchase. A bond is essentially a loan to a company. Returns on both of these investments are contingent on the company remaining in operation. If a company declares bankruptcy and liquidates its assets, common stockholders are the last in line to receive a share of the proceeds. If the company has assets, bondholders will be paid first, followed by preferred stockholders. If you own common stock, you will receive whatever is left, which could be nothing.

When purchasing an annuity, keep the financial strength of the insurance company issuing the annuity in mind. You want to know that the company will be around and financially stable during your payout phase.

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