Bonds represent a financial asset as opposed to a real asset. A financial asset is a liquid asset whose value is determined by a contractual right or ownership claim.
Financial assets include equities, bonds, mutual funds, as well as bank deposits. Financial assets, unlike land, property, commodities, or other tangible physical assets, do not essentially have inherent physical worth or even a physical form. Rather, their value is determined by factors such as supply and demand in the market in which they trade, in addition to the level of risk they carry.
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