Not all bonds are the same. There are types of issuers with its associated varying levels of risk and benefits:
1. Government Bonds: Recommended by the national governments, one example is U.S. Treasury bonds. In general, they are risk-free because they are issued or guaranteed by the government. A high-interest-rate bond pays a lesser interest rate but holds a very minimal risk of losing money.
2. Corporate Bonds: This is for corporate companies to raise funds for some specific undertaking or cost. They have a higher return than for government bonds but also much more risk.
3. Municipal Bonds: Issued by states or other local governments-they are commonly known as "monies." Even though these bond issues finance many public works projects-schools and highways, for instance, these in themselves are attractive because the interest you earn from them is tax-free.
4. Junk Bonds: These are issued by firms having poor credit ratings. Due to higher returns associated with them they are even more prone to defaults.
5. International bonds: Such as those issued by countries and international organizations and thus have more diversified portfolios but issues of currency exchange, and sometimes lack of political stability in these transnational corporations.

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