Shakespeare's "neither a borrower nor a lender be" is good advice for maintaining harmony with friends and family. But if everyone followed it, investors would lose out on an entire asset class: Bonds.
Bonds allow individual investors to be lenders. Companies or governments, which issue the bonds, are the borrowers. The money generated from bond sales pays for roads, airports, factories and the start-up costs for all manner of innovative products. Bonds also happen to benefit your portfolio. Referred to more formally as fixed income, they are an essential part of a balanced stable of investments.
