Bond

A bond is a debt security, traditionally bearing a fixed rate of interest, and issued as a stand-alone (rather than off an MTN programme). Compare with a note — which traditionally bears interest at a floating rate, and a medium term note, which can be fixed, floating or structured with all kinds of exotic derivative payoffs, but is issued from a medium term note programme, rather than as a stand-alone issue.

Contrast all those debt securities to equity securities — instruments such as shares, warrants units, which pay neither principal nor interest, but rather account for the overall performance of the company who issue them.

Debt securities generally rank ahead of equity securities in the capital structure of the issuer. This is because an issuer must pays off creditors before shareholders.