In
finance, a
bond is an instrument of indebtedness of the bond issuer to the holders. It is a debt
security, under which the issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay them
interest (the
coupon) and/or to repay the principal at a later date, termed the
maturity date. Interest is usually payable at fixed intervals (semiannual, annual, sometimes monthly). Very often the bond is negotiable, i.e. the ownership of the instrument can be transferred in the secondary market. This means that once the transfer agents at the bank medallion stamp the bond, it is highly liquid on the second market.