Bonds & Mutual Funds
Mutual Funds and Bonds
Bond -- A debt instrument issued for a period of more than one year with the purpose of raising capital by borrowing.

Bond Rating -- A measure of the quality and safety of a bond, based on the issuer's financial condition.  Typically, AAA is highest (best), and D is lowest (worst).

Coupon -- The term for each interest payment made to the bondholder. 

Coupon Bond --  An unregistered, negotiable bond on which interest and principal are payable to the holder, regardless of whom it was originally issued to. The coupons are attached to the bond, and each coupon represents a single interest payment. The holder submits a coupon, usually semi-annually, to the issuer or paying agent to receive payment

Coupon Rate  -- The interest rate stated on a bond, note or other fixed income security, expressed as a percentage of the principal (face value). 

Diversification -- A portfolio strategy designed to reduce exposure to risk by combining a variety of investments, such as stocks, bonds, and real estate, which are unlikely to all move in the same direction.

Face Value -- the amount repaid to the investor when the bond matures 

Liquidity -- The ability of an asset to be converted into cash quickly and without any price discount

Maturity Date -- The date on which a debt becomes due for payment. 

Risk -- The quantifiable likelihood of loss or less-than-expected returns.
 
Risk and Reward Ratio -- - A measure of the degree of risk inherent in a given investment in relation to the potential profit associated with it.

 Zero-coupon Bond -- A bond which pays no coupons, is sold at a deep discount to its face value, and matures at its face value.