The Dhaka Stock Exchange (DSE) experienced a slight reduction in trading volume on Monday, the first working day of the week after the Durga Puja holiday, as the prices of most companies fell. Out of 396 companies traded, the prices of 225 declined, 119 increased, while 52 remained unchanged. By the close of trading, the benchmark index DSEX had dropped by 48.51 points, settling at 5,373 points. The DSES Shariah Index saw a decrease of 14.29 points, ending at 1,191.57, and the DS30 Blue Chip Index fell by 15 points to close at 1,969.52. Dhaka Stock Exchange opens lower after Durga Puja holiday The total transaction volume at DSE amounted to Tk 350.73 crore, marking a 6.87% decline from the previous trading day last Wednesday, when the turnover stood at Tk 376.60 crore. Over at the Chittagong Stock Exchange (CSE), the CASPI index recorded a marginal drop of 0.26 points, closing at 15,094.79 points. A total of 192 companies were traded, with 84 seeing price increases, 85 experiencing declines, and 23 remaining unchanged. The total value of shares and units traded at the CSE was Tk 9.30 crore, up from Tk 8.31 crore on the previous trading day.  

Dhaka Stock Exchange (DSE) closed on a positive note on Wednesday, gaining 98 points in its broad index with a daily transaction volume of Tk 376.60 crore, marking an increase from the previous day's turnover. The DSE Broad Index rose by 98 points to close at 5,422 points, while the DSE Shariah Index (DSES) increased by 18 points, reaching 1,205 points. The DSE-30 Index, which tracks the top 30 companies, gained 45 points, closing at 2,198 points. Of the 396 companies and mutual funds traded, 327 saw their share prices increase, 37 declined, and 32 remained unchanged, reflecting overall positive market sentiment. Read: DSEX climbs by 26.99 points as majority of listed companies show gains The daily turnover on the DSE amounted to Tk 376.60 crore, an increase of Tk 21.23 crore compared to the previous day’s transaction of Tk 355.37 crore. On the Chittagong Stock Exchange (CSE), the CASPI Index gained 173 points, closing at 15,135 points. A total of 204 companies participated in the day’s trading, with 125 seeing price increases, 53 experiencing declines, and 26 remaining unchanged. The CSE recorded a turnover of Tk 8.31 crore, down from the previous day’s transaction of Tk 11.32 crore. Read more: DSEX drops by 43 points as prices of 288 companies fall, Chittagong Stock Exchange follows suit

The Dhaka Stock Exchange (DSE), the country’s primary capital market, witnessed an upward trend in trading on Wednesday, the last working day of the week. After a difficult session on Tuesday, where all indices posted losses, the market bounced back strongly. In the first hour of trading, shares of 225 companies advanced, 76 declined, and 78 remained unchanged, according to data from the DSE. This early momentum helped boost all major indices. Dhaka Stock Exchange investors demand BSEC Chairman’s resignation amid market instability As of 11:30 am, the DSEX, the main index, had risen by 26.99 points, reaching 5,350.21. The DSES Shariah index saw a gain of 7.76 points, standing at 1,195.5, while the DS30, which tracks blue-chip companies, climbed by 9.59 points to 1,948.8. Trading began at 10 am, and sources confirmed a rise in the volume of shares being traded as the market opened on an optimistic note.

Jeff Bezos filed a statement with federal regulators indicating his sale of nearly 12 million shares of Amazon stock worth more than $2 billion. The Amazon executive chairman notified the U.S. Securities and Exchange Commission of the sale of 11,997,698 shares of common stock on Feb. 7 and Feb. 8. The collective value of the shares of Amazon, which is based in Seattle where he founded the company in a garage about three decades ago, was more than $2.04 billion, according to the listed price totals. Read: US-Bangla Airlines welcomes first Airbus, another Boeing to expanding fleet  The stocks were grouped in five blocks between 1 million and more than 3.2 million. In a separate SEC filing, Bezos listed the proposed sale of 50 million Amazon shares around Feb. 7 with an estimated market value of $8.4 billion. Bezos stepped down as Amazon's CEO in 2021 to spend more time on his other projects, including the rocket company, Blue Origin, and his philanthropy. His address on the stock filings is listed as Seattle, although he reportedly has relocated to Miami. Read more: February 2024 Amazon Prime Originals: Most-Hyped Shows, Series, and Movies

Asian stock markets followed Wall Street higher on Tuesday ahead of a Federal Reserve decision on another possible interest rate hike amid worries about global banks. Shanghai, Hong Kong and Seoul advanced. Japanese markets were closed for a holiday. Oil prices declined. Wall Street's benchmark S&P 500 index rose 0.9% on Monday after U.S., European and Japanese central banks announced measures to ease strains on the financial system, including lending more dollars if necessary. The collapse of two U.S. banks and the takeover of troubled Credit Suisse have heightened fears other lenders might crack under the strain of repeated rate hikes to cool economic activity and inflation that is near multi-decade highs. Traders expect the Fed to go ahead with another rate hike Wednesday but think it might be held to 0.25 percentage points, down from the 0.5 points previously expected. “Can the Federal Reserve really continue to hike rates in the face of a banking crisis?" Clifford Bennett of ACY Securities said in a report. “There are ongoing stresses in the banking system that will only grow with further rate hikes.” The Shanghai Composite Index gained 0.4% to 3,246.88 and the Hang Seng in Hong Kong advanced 0.9% to 19,175.92. The Kospi in Seoul rose 0.4% to 2,387.52 and Sydney's S&P-ASX 200 surged 0.8% to 6,955.40. New Zealand declined while Southeast Asian markets rose. On Wall Street, the S&P 500 rose to 3,951.57. The Dow Jones Industrial Average gained 1.2% to 32,244.58. The Nasdaq composite added 0.4% to 11,675.54. Swiss regulators arranged Sunday for UBS to acquire rival Credit Suisse for almost $3.25 billion. Credit Suisse has been battling a unique set of problems for years, but they came to a head last week as its stock price tumbled to a record low. Attention in the United States has focused on smaller and mid-sized banks. The surge in the Fed's benchmark lending rate to a range of 4.5% to 4.75%, up from close to zero at the start of last year, caused prices of bonds and other assets on banks' books to fall, raising concern about their financial health. First Republic Bank has been at the center of investors’ crosshairs in the hunt for the industry’s next victim. Its shares fell 47.1% after S&P Global Ratings cut its credit rating for the second time in a week. S&P said it could lower the rating even further despite a group of the biggest U.S. banks announcing last week they would deposit $30 billion in a sign of faith in First Republic. New York Community Bancorp jumped 31.7% after it agreed to buy much of Signature Bank in a $2.7 billion deal. Signature Bank became the industry’s third-largest failure earlier this month. In energy markets, benchmark U.S. crude lost 56 cents to $67.26 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 90 cents on Monday to $67.64. Brent crude, the price basis for international oil trading, declined 59 cents to $73.20 per barrel in London. It gained 82 cents the previous session to $73.79. The dollar rose to 131.39 yen from Monday's 131.32 yen. The euro declined to $1.0713 from $1.0724.

Global stock markets sank Monday after Swiss authorities arranged the takeover of troubled Credit Suisse amid fears of a global banking crisis ahead of a Federal Reserve meeting to decide on more possible interest rate hikes. Hong Kong's main index slid 2.7%. London, Frankfurt and Paris opened down more than 1%. Shanghai, Tokyo and Sydney also declined. Wall Street futures were off 1%. Oil prices plunged more than $2 per barrel. Swiss authorities on Sunday announced UBS would acquire its smaller rival as regulators try to ease fears about banks following the collapse of two U.S. lenders. Central banks announced coordinated efforts to stabilize lenders, including a facility to borrow U.S. dollars if necessary. Switzerland’s share benchmark was down 1.8%, while Credit Suisse’s shares plunged 63% and rival UBS, which is acquiring it, sank 14%. Also Read: UBS to buy Credit Suisse for nearly $3.25B to calm turmoil Investors worry banks are cracking under the strain of unexpectedly fast, large rate hikes over the past year to cool economic activity and inflation. Prices of bonds and other assets on their books fell, fueling unease about the industry’s financial health. “Investors are waiting to see where the dust settles on the banking saga before making any bold moves,” said Stephen Innes of SPI Asset Management in a report. In early trading, the FTSE 100 in London lost 1.6% to 7,220.62. Frankfurt's DAX fell 1.4% to 14,555.79 and the CAC 40 in Paris lost 1.2% to 6,842.36. On Wall Street, the future for the benchmark S&P 500 index was off 1%. That for the Dow Jones Industrial Average was down 1.2%. On Friday, the S&P 500 lost 1.1%. The Dow fell 1.2% and the Nasdaq composite lost 0.7%. In Asia, the Hang Seng in Hong Kong lost 2.7% to 18,879.20 after being down 3.3% at one point. The Nikkei 225 in Tokyo shed 1.4% to 26,945.67. The Shanghai Composite Index lost 0.5% to 3,234.91 after the Chinese central bank on Friday freed up more money for lending by reducing the amount of their deposits commercial lenders are required to hold in reserve. The Kospi in Seoul retreated 0.7% to 2,379.20 and Sydney’s S&P-ASX 200 lost 1.4% to 6,898.50. India's Sensex lost 1.3% to 57,241.45. New Zealand and Southeast Asian markets also declined. The Swiss government said UBS will acquire Credit Suisse for almost $3.25 billion after a plan for the troubled lender to borrow as much as $54 billion from Switzerland’s central bank failed to reassure investors and customers. U.S. regulators have also tried to calm fears over threats to banking systems. The Federal Reserve said cash-short banks had borrowed about $300 billion in the week up to Thursday. Separately, New York Community Bank agreed to buy part of failed Signature Bank in a $2.7 billion deal, the Federal Deposit Insurance Corp. said Sunday. The FDIC said $60 billion in Signature Bank’s loans will remain in receivership and are expected to be sold off in time. Investors worry about other lenders with shaky finances. Credit Suisse is among 30 institutions known as globally systemically important banks. Traders expect last week’s turmoil to push the Fed to limit a rate hike at this week's meeting to 0.25 percentage points. That would be the same as the previous increase and half the margin traders expected earlier. A survey released Friday by the University of Michigan showed inflation expectations among American consumers are falling. That matters to the Fed, which has said such expectations can feed into virtuous and vicious cycles. In energy markets, benchmark U.S. crude plunged $2.45 to $64.29 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.61 on Friday to $66.74. Brent crude, the price basis for international oil, lost $2.67 to $70.30 per barrel in London. It retreated $1.73 the previous session to $72.97. The dollar declined to 130.70 yen from Friday’s 131.67 yen. The euro retreated to $1.0647 from $1.0681.

Asian stock markets rebounded Wednesday after Wall Street stabilized following declines for bank stocks and U.S. inflation eased but stayed high. Shanghai, Tokyo, Hong Kong and Sydney advanced. Oil prices rose more than $1 per barrel, recovering some of the previous day's losses. Wall Street's benchmark S&P 500 index rose Tuesday as bank stocks recovered some of their losses caused by worries customers might pull out deposits following the collapse of two U.S. lenders. Stocks rose despite data showing prices rose 6% over a year ago in February, decelerating from the previous month's 6.4% but above the Federal Reserve's 2% target. Also Read: Asian shares mostly sink on jitters after US bank failure “The anchoring of less hawkish expectations provided some catalyst for risk sentiments to recover,” said Yeap Jun Rong of IG in a report. “There were also no new negative headlines of another bank or funds in trouble, which allows investors’ sentiments to settle down.” Investors had worried the Fed might respond to enduring upward pressure on prices by speeding up the pace of interest rate increases to dampen economic activity and inflation. But those jitters were overshadowed by anxiety about the U.S. financial system following the collapse of Silicon Valley Bank on Friday and Signature Bank on Sunday. President Joe Biden and regulators tried to assure the public risks were contained and deposits in other banks were safe. Tuesday's data showed core inflation, with volatile energy and food prices stripped out to show a clearer trend, was 0.5% in February over the previous month, edging up from January's 0.4% gain. The Fed pays close attention to core inflation in making monetary policy. The Fed faces a dilemma over how to respond when banks already are under strain after the fastest pace of rate hikes in a decade knocked down prices of their assets. The Shanghai Composite Index rose 0.7% to 3,267.15 after Chinese economic activity improved in January and February but less than expected after anti-virus controls ended. Retail sales rose 3.5% over a year earlier, rebounding from December's 1.% contraction. Factory output rose 2.4%, up from 1.3%. The Nikkei 225 in Tokyo advanced 0.1% to 27,258.01 after major Japanese companies announced they had agreed with unions to the biggest wage increases in almost two decades. Low wages are seen as a major drag on economic growth in Japan, but fewer than one in five Japanese workers belong to unions. The Hang Seng in Hong Kong jumped 1.3% to 19,490.35 and the Kospi in Seoul surged 1.5% to 2,384.38. India's Sensex opened up 0.2% at 58,297.50. New Zealand and Southeast Asian markets advanced. Traders rushed Monday to place bets that the Fed could keep rates steady at its next meeting, instead of accelerating to a hike of 0.50 percentage points, double last month's margin, according to data from CME Group. On Wall Street, the S&P 500 rose 1.7% to 3,920.56, reversing from a three-day string of declines. The Dow Jones Industrial Average rose 1.1% to 32,155.40. The Nasdaq added 2.1% to 11,428.15. First Republic Bank jumped 27% after plunging 67.5% over the prior three days. KeyCorp gained 6.9%, Zions Bancorp. rose 4.5% and Charles Schwab climbed 9.2%. The yield on a two-year Treasury, or the difference between the market price and the payout at maturity, climbed back to 4.21% from 4.02% late Monday, another huge move. The yield on the 10-year Treasury jumped to 3.66% from 3.55%. In energy markets, benchmark U.S. crude rose $1.08 to $72.41 per barrel in electronic trading on the New York Mercantile Exchange. The contract plunged $3.47 on Tuesday to $71.33. Brent crude, the price basis for international oil trading, advanced $1.09 to $78.54 per barrel in London. It lost $3.32 the previous day to $77.45. The dollar declined to 134.09 yen from Tuesday's 134.19 yen. The euro rose to $1.0754 from $1.0741.

Stocks are falling on Wall Street Monday ahead of a week full of potentially market-moving events, from decisions on interest rates around the world to earnings reports from the biggest U.S. companies. The S&P 500 was 0.7% lower in midday trading, giving back some of its gains from last week when it reached its highest level since early December. The Dow Jones Industrial Average was down 60 points, or 0.2%, at 33,917, as of 12:15 p.m. Eastern time, and the Nasdaq composite was 1.2% lower. Markets have been veering recently on worries that the economy and corporate profits may be set for a steep drop-off, along with competing hopes that cooling inflation will get the Federal Reserve to take it easier on interest rates. The central bank’s next decision on rates is coming Wednesday, and most investors expect it to announce an increase of just 0.25 percentage points. That would be the smallest increase since March, following a spate of hikes of 0.75 points and then a 0.50-point increase, and it would mean less added pressure on the economy. Higher rates combat inflation by intentionally slowing the economy, while also dragging down on prices for investments. Inflation has been cooling since the summer amid last year's blizzard of rate hikes, but the economy has also been showing signs of concern. The big question is whether Fed Chair Jerome Powell on Wednesday afternoon will give markets what they want to hear — hints that rate hikes will end soon and rate cuts may even be possible late this year — or stick to the Fed’s mantra that it plans to keep rates higher for longer, even if a modest recession hits. “I think that they have no intention of cutting rates this year,” said Sam Stovall, chief investment strategist at CFRA Research, adding that the Fed waits an average of roughly nine months after its last rate hike before cutting. “They’ll reiterate that they don’t want to make the mistakes of the 1970s," he said, "but I think in the back of their minds, they’re going to say no matter which inflationary indicator you look at, they’re all heading in a stairstep downward pattern.” Read more: Wall Street braces for earnings to get hit by inflation Central banks for Europe and for the United Kingdom are also set to announce their latest increases for rates this week. Beyond interest rates, more than 100 companies in the S&P 500 are scheduled this week to report how much profit they made in the last three months of 2022. Among them are tech heavyweights Apple, Amazon, and Google’s parent company. Because these companies are three of the four biggest on Wall Street by market value, their stock movements carry much more sway on the S&P 500 than others. Apple's 1.4% drop Monday, for example, was one of the heaviest weights on the S&P 500. The only other stock that rivals them in size, Microsoft, shook Wall Street last week when it gave forecasts for upcoming results that raised worries about a slowdown in corporate spending on tech. Its stock fell 1.8% Monday. Companies generally look to be on track to report slightly weaker profit for the end of 2022 than expected, according to a BofA Global Research report. That’s an indication that the strong January enjoyed by the S&P 500 so far is more about improving sentiment on Wall Street than about better fundamentals, strategist Savita Subramanian wrote. Strategists at Morgan Stanley led by Michael Wilson warn tougher times may be ahead. “The reality is that earnings are proving to be even worse than feared based on the data, especially as it relates to margins,” they wrote in a report. “Secondly, investors seem to have forgotten the cardinal rule of ‘Don’t Fight the Fed’. Perhaps this week will serve as a reminder.” Later this week, the U.S. government will also give its latest monthly update on the job market. Hiring has remained remarkably resilient across the broad economy, even as housing and other corners weaken sharply under the weight of all the Fed’s rate hikes from last year. Some big tech companies have announced high-profile layoffs after acknowledging they misread their boom coming out of the pandemic. But job cuts may be starting to spread to other areas of the economy. Hasbro and 3M last week announced layoffs. All told, economists expect Friday’s report to show that U.S. employers added 187,500 more jobs than they cut during January. That would be a slowdown from December’s hiring of 223,000. The yield on the 10-year Treasury rose to 3.54% from 3.51% late Friday. The two-year yield, which tends to move more on expectations of Fed actions, rose to 4.29% from 4.20%.

When it comes to investing, people usually look for effective strategies to make money. Some investors choose real estate, and mutual funds and others prefer stocks or bonds. Stocks can be a great choice for both short-term and long-term investments. Investing in stocks not only gives you the scope to make money but also makes you the owner of a part of a company. There are a few things to consider when selecting stocks for any company. 10 Essential Criteria to Consider for Selecting Stocks For non-technical common investors, understanding stock market fluctuations is difficult. If you want to buy a stock, you must keep in mind some factors. Here are 10 factors you need to know, according to experts. Company Background Analisis   Buying shares in a company means buying partial ownership of that company. So proper review of the qualitative aspects of that company is very important. You will need to check whether the company’s products or services are popular with its customers. Besides, don’t forget to check who is managing the company.  Read More: Shares vs Bonds: What is the Ideal Investment Opportunity You can do a Google search or ask people you know about how the company’s managers are—whether they are trustworthy as your partner or not. Also, look for what is the competence, integrity, and innovation of the company’s managing director and other senior officers—their qualifications, training, business success, and more. Price-to-Earnings (P/E) Ratio The price-earnings ratio is a measure of how many times a company’s shares are selling for its earnings. If the earnings per share of a company are Tk5, and the market price of the share is Tk45, then the price-earnings ratio will be 9. This means that if the company distributes all of its earnings as dividends, it will take 9 years to recover the invested money.  But if the market price of the share was Tk 100, then the price-earnings ratio or PE ratio would be 20. That is, if the company’s income stream remains unchanged, it will take 20 years to return the investment. The market average P/E ratio is 20-30. The lower the PE ratio, the lower the risk of the investment. Read More: Share Market Investment Guide: How to Invest in Stocks Net Asset Value Per Share Before buying a company’s share, check asset value per share. There should be an adjustment of the market price with this. However, unless the company goes into liquidation, the investor does not really care about the asset value.  Only shareholders can get a portion of those assets when the company is bankrupt. In this case, the bank loan and other dues are paid off before the sale price of the asset. After that, anything left over is distributed among the shareholders. Earnings Per Share Check the Earnings Per Share (EPS). However, it depends on the company. The more it is, the better. Higher EPS means higher dividend potential. If the EPS is low, the dividend potential is also low. Read More: Saving vs. Investing Money: Know the Pros and Cons. Capital Utilization Efficiency of The Company A company that can invest more of its capital in more profitable projects is expected to benefit its shareholders. On the other hand, if a company invests a lot of capital in a less profitable project, its profits and share price have less possibility to improve.  For example, banks that have invested more capital in mobile banking or digital banking projects over the last 10 years have done much better in terms of profits and share prices than banks that have invested in stock brokerage projects. Balance Sheet Generally, companies whose financial debt is much higher than their total assets (over 60-70%) have a higher risk of losing their shareholders’ capital. So, one should be careful while investing in such companies. Read More: Is Sanchayapatra a Good Investment in 2022? Total Number of Shares Before you buy stocks of any company, check their total number of shares and see how much it floats. According to the demand-supply formula, if the number of shares is low, its price is more likely to increase. On the other hand, if the number of shares is more, it is more readily available in the market.  In addition to that, it is better to buy shares that are traded regularly. Because if you need money on an urgent basis for any reason, it is possible to collect money easily by selling shares. But if you invest in shares that are not traded regularly, it is not possible to withdraw the investment on an emergency basis. The Ratio of Authorized Capital to Paid-Up Capital Issuance of bonuses and right shares is quite difficult if these two capital amounts are close. In this case, the company should increase the authorized capital earlier. Investors with a particular inclination towards bonus dividends should take note of these factors. A rule of thumb is that paid-up capital can never exceed authorized capital. Read More: Plot vs Apartment: Which is the Better Investment Option? Dividend Yield The market value of the shares may be higher than the face value in most cases. Hence the dividend rate does not indicate the actual return. The dividend yield is the exact return of shares, which is the percentage of dividends received on the investment based on market value. The dividend yield ratio is obtained by multiplying the declared dividend by 100 and dividing it by the market price of the respective shares. The higher the yield, the higher the investor’s earnings. Track Record Check the company’s last 3-4 years' track record. See how much it pays in dividends. Also, check the annual average price and try to buy shares close to this price. Read More: Is Gold a Good Investment in 2022? Final Words So far, we have shared what to consider before buying stocks or shares. When buying a stock, remember profit must be ensured at the time of buying, not at the time of selling. That is, if you can buy shares at a good price, there will be a good chance of good profit. If you buy a share at a high price, the profit potential will decrease a little. Additionally, it should be remembered that hasty decision decisions are not good in the share market.

If someone thinks of investing their money, it almost universally comes down to two major ways – either through equity or debt. Equity is where an investor becomes a part owner of the invested company or business. Whereas debt is the traditional lending and borrowing process. Here the investor acts as the creditor and the return is the interest plus capital. Interestingly, these two concepts are also what define shares and bonds. So, Shares or bonds, what is the best investment stream? And more importantly, what’s right for you? Let’s find out. What are Shares? A share is a unit of measurement for a stock, which is the actual asset in which you invest. Shares make up the basis of equity investment. Here the investor invests to become a part owner of the company. The size of the owner depends on the number of shares bought. It also depends on the number of shares in circulation by the company. Read More: Apartment Buying Mistakes to Avoid to Secure Your Investment At its core, an investor or shareholder utilizes the high-risk, high-return factor of share investment. For example, if the company consistently performs well, the shareholder will enjoy a consistently high ROI. On the other hand, if a company performs, poorly, it will lead to a loss of investment. Shareholders receive dividends annually based on the profit margin of the company. Depending on the business cycle, this margin can be high or even so low that there might be no dividend at all. If an investor holds a substantial share in a company, they get a place on the board of directors where they can vote to decide the future course of the company. Shares essentially allow an individual investor to take responsibility and the implications are also simple. You share the profit as well as the loss in an equal manner, hence the high risk, high return factor. Read More: Metaverse Real Estate Investment: Buying Land, Apartment, Property in Virtual World Advantages of Shares Compared to Bonds The main advantage of shares is the potential for high returns. Other investment opportunities can hardly provide a similar level of return possibilities. Shares also pay dividends which is another addition to lucrative profit margins. The return on investment will grossly depend on the period of high profit or less. Since the instrument of investment for shares is equity, investors can expect proportional growth or loss on their investments. The same doesn’t hold for bonds. Investors can input their ideas into the future process of a business with share investments. It makes for a more controlled and impactful investment compared to bonds. Read More: Share Market Investment Guide: How to Invest in Stocks in Bangladesh Disadvantages of Shares Compared to Bonds The only disadvantage of shares compared to bonds are the high-risk factor. There is no way to understand how a business will perform given the volatile investment climate.  Every share is traded through a central stock exchange commission which may go through a gross fluctuation by the minute. So if you’re risk-averse, chances are that shares aren’t really for you. Read More: Making Investment Decisions: Factors to consider when investing money What are Bonds? You lend your friend a crisp 100-dollar bill and he pays you back 110 dollars the next month. The additional 10 dollars over the capital is the interest on top of the capital. Bonds follow this exact principle of debt instrument. Here the investor, who buys the bond, is the creditor, and the bond seller company or business is the debtor. The investor (bond buyer) and the company (bond seller) essentially draw up a loan agreement. As part of the agreement, the company will pay back the invested sum within a certain date along with a regular fixed interest rate on top of the capital. It's low risk with a low return but provides better security on the invested capital. Read More: Plot vs Apartment: Which is the Better Investment Option? Advantages of Bonds over Shares The only advantage of bonds over shares is the low volatility. Unlike shares, bonds have a fixed return rate on top of the capital. Here, the investor knows upfront how much they will be getting out of the investment at the end of the cycle. Even in case, the company goes bankrupt, the bond investors will get priority compared to the shareholders in returning the dues. As a result, the investments of bondholders are secured in both ways. Disadvantages of Bonds Compared to Shares The main disadvantage of bonds compared to shares are the reduced return and lack of equity. At the cost of security, bonds investor has to forego a substantial ROI generation. The bonds' investors do not get any say in the process and proceedings of the business which is otherwise possible with shares. Read More: Is Sanchayapatra a Good Investment in 2022? Lifecycle of Bonds and Shares Both bonds and shares have their respective lifecycles which are often important for an investor to understand which investment cycle works best for them. A share has typically 4 phases in its lifecycle – accumulation phase, markup phase, distribution phase, and downtrend phase. Each of these phases comes up cyclically where the price stabilizes, goes up, shareholders sell and the price tumbles again. The bond lifecycle is much more simple compared to the shares. Here there’s a primary market where the bond gets issued, a secondary market where the bond gets traded, and finally maturity, where the investors get back their capital. Read More: Is Gold a Good Investment in 2022? The companies can use the resolved bonds at maturity to venture into new refinancing opportunities. Shares vs. Bonds – Which One is the Better Investment Option? Shares and bonds are both great investment options. But the choice of investment depends much on what you want out of your investment. If you want a high return and aren’t worried about the associated risks, go for shares. But if you are more concerned about the security of the investment and returns are your secondary concern, then head over to the bond market. Read More: Saving vs. Investing Money: Know the Pros and Cons Final Words Shares and bonds are both equally popular as investment opportunities. The process of investing through shares usually requires a BO account in a brokerage firm. On the other hand, a bond requires an agreement drawn out through a third party, usually a bank. Both stocks and bonds are protected by strict government financial regulation with the former having its separate regulatory commission. So depending on your preference, both shares and bonds can be an effective way to increase your wealth base.