obligatsioones

Obligatsioones, often translated as bonds, are a type of debt instrument where an issuer owes the holders a debt and is obliged to pay them interest and repay the principal at a later date. Essentially, an investor loans money to an entity (like a corporation or government) for a defined period in exchange for periodic interest payments and the return of the principal amount at maturity.

The issuer of an obligatsioon promises to pay a fixed or variable interest rate, known as the coupon rate, to the bondholder. This interest is typically paid semi-annually or annually. At the end of the bond's term, called the maturity date, the issuer is obligated to repay the original amount borrowed, known as the face value or principal.

Obligatsioones are issued for various reasons, including financing government projects, corporate expansion, or managing public debt. They are considered a relatively safe investment compared to stocks, as they represent a contractual obligation to repay. However, the risk associated with a bond depends on the creditworthiness of the issuer. Bonds issued by governments with strong economies are generally considered less risky than those issued by companies with weaker financial standing.