Are bonds worth investing in?

While stocks may come to mind first when you think about investing, another major investment category is bonds. They can not only add diversification to an investment portfolio — an important ingredient in protecting against market volatility — but they also tend to be a safer investment than stocks. However, with bonds’ lower level of risk comes a lesser potential for reward, and their risk is not non-zero.

Here is what you need to know about this major asset class to decide whether — and how — to include them in your investment portfolio.

How do bonds work?