What is the daily bond market?


Quick Answer

The daily bond market is a financial market for the buying and selling of debt securities. Most of these debt securities are government-issued or corporate debt, according to Investopedia. The bond market allows large organizations, private and public, to borrow money from several sources. The three major groups in the bond market are issuers, purchasers and underwriters.

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Full Answer

Bond market issuers sell debt securities to raise capital to fund their businesses. The main issuers in the daily bond market are banks, governments and large corporations. Investment banks act as underwriters, or intermediaries, helping these issuers sell their bonds, per Investopedia. Underwriters are necessary to issue bonds due to the large and complex nature of these offerings.

Local, state and federal governments are major players in the daily bond market, states Investopedia. They are responsible for significant borrowing and lending, often to banks or other governments. Individual investors do play a role in the bond market, but they account for a small percentage of daily trades.

Due to limited demand, information on bond quotes is difficult to find, notes Investopedia. The best way for individuals to buy bonds is through a brokerage account. The brokerage firm provides bond quotes and trading tips for beginner investors.

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