Question

Why is a high-quality bond typically considered a lower-risk investment than a stock? ABonds are issued by many different entities . BStocks are stable and do not change often. CWell-established company stocks pay dividends to their investors. DA bond typically pays a fixed, predictable amount of interest each year.

Answer 1

A bond of high quality is considered a lower-risk investment compared to stock because D. A bond typically pays a fixed, predictable amount of interest each year.

Stocks and bonds are both assets which investors use in their portfolios. Stocks offer an ownership stake in a company, while bonds are loans made to an organization. Stocks are riskier because they are more volatile than bonds.