Bonds are considered to offer a guaranteed return, as they must be on by law, but which is still a potential risk that investors face?

Question

Rolando Ibarra

Social Studies

2 July, 04:13

Bonds are considered to offer a guaranteed return, as they must be on by law, but which is still a potential risk that investors face?

+3

Answers (1)

Know the Answer?

Willow Mercado · Answer 1

Bonds are considered very low risk for the very simple reason that they are backed by the power of the credit of the United States.

So, the only REAL risk for investors is that the United States default on its debts, that is, that they don't pay their debts. This could happen if all foreign owned debts are called in at once.