Fixed-income security

Fixed-income security is an investment that earns money in the form of fixed interest payments. Also, at the end of maturity (which is basically the “term” or “length” of the investment), you receive your initial investment back.

Example: Bonds and money markets are some of the two most common types of fixed income securities. Check out our definition of a bond first. Then, understand that a federal government bond is a type of fixed-income security. They’re called treasury bonds, and they earn periodic interest until the end of their term (between 10 and 30 years).

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