Bonds are a form of debt security that provides fixed income that organizations issue to investors to raise capital.

For example, Amazon issues a five-million-dollar ten-year bond with a five-percent coupon rate and a face value of a thousand dollars per bond.

Here, investors are promised a return of their principal, which provides them with a fixed income.

Investors are promised a return of their initial investment after a decade, giving them predetermined maturities. Investors will be able to match their investment horizons to their financial objectives.

If the investor held the bond till maturity, they would receive a thousand dollars per bond regardless of market fluctuations.

Certain bonds, like California Municipal bonds, may offer tax-exempt interest income, making them an attractive investment.

Bonds carry risk, evaluated by credit rating agencies, taking the issuer's creditworthiness and default risk into account.

Higher-rated bonds have lower interest rates due to their low risk of default, while lower-rated bonds offer higher interest rates to compensate investors for high risk.

These features appeal to conservative investors seeking stable returns.