What is another term commonly used for bonds?

Bonds are often referred to as "coupons" because they typically come with a fixed interest rate, represented by the coupon rate, which dictates the amount of interest paid to bondholders periodically. This term originates from the physical bonds historically having coupons attached that investors would detach and redeem for interest payments. This characteristic highlights the predictable income stream that bonds provide, making them an attractive investment for those seeking regular cash flows. In this context, the term "coupon" underscores the essential feature of bonds that sets them apart from other financial instruments, such as stocks or other equity investments. Other options, while related to finance, refer to different concepts; for instance, yield denotes the income return on an investment, dividends pertain to profit distributions from stocks, and interest refers to the cost of borrowing money, which can apply broadly.