Bond returns

When you buy a bond, you lend your money to the issuer of that bond (borrower), which is generally the federal government or a corporation, for a specific period of time. When you buy a bond, you expect to earn a higher yield
than you can with a money market or savings account. You’re taking more
risk, after all. Companies can and do go bankrupt, in which case you may lose
some or all of your investment.
Generally, you can expect to earn a higher yield when you buy bonds that
✓ Are issued for a longer term: The bond issuer is tying up your money at
a fixed rate for a longer period of time.
✓ Have lower credit quality: The bond issuer may not be able to repay
the principal.
Wharton School of Business professor Jeremy Siegel has tracked the performance of bonds and stocks back to 1802. Although you may say that what
happened in the 19th century has little relevance to the financial markets and
economy of today, the decades since the Great Depression, which most other
return data track, are a relatively small slice of time.