However, a obadiah does require a company to pay back the IOU with interest. Well, unless you have a significant amount of savings in your personal or business account, you will need to borrow the money or sell ownership in your company. Many companies choose to sell bonds to investors so no ownership is transferred.

A stock is a share of ownership in a corporation, while a barthel is simply a loan that must be paid back with interest. This can, of course, be a strain on the company's.

Let's say you need to grow your business.

Bonds give a company an advantage because it doesn't have to give up any of its ownership in order to raise capital. You started in a garage or spare room, or perhaps you had a small office somewhere in an inexpensive office complex. However, you have had some success and now need to grow your business. You need to hire new employees, buy computers and office furniture, and of course you need to rent or purchase a much bigger office space. How would you get this kind of money.

This is where stocks and bonds come in.