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irga5000 [103]
3 years ago
15

How does the risk/return ratio of a government bond compare with that of other types of investments?

English
1 answer:
myrzilka [38]3 years ago
5 0

Although there's no 100% guaranteed formula, usually higher risk levels are correlated with  higher returns;

Government bonds are considered low risk investments; most bonds pay a fixed rate of interest, which is backed by a commitment from the issuer.

Thus compared with other types of investments, government bonds normally deliver lower returns, but with the edge of a lower risk.

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