The Difference Between Stocks and Bonds

Last week I finished reading Liar’s Poker written by Michael Lewis. The book is partly about his experience as a bond salesman at Salomon Brothers in the 1980’s and partly about expansion of the bond market itself during the 1980’s. The parts about how the bond market evolved to compete with the stock market in the minds of traders in the 1980’s were the most fascinating parts of the book for me. I was telling a neighbor about the book over the weekend and she mentioned that she didn’t know what the difference between a bond and stock really is. I gave her my brief explanation then turned to YouTube for a better one.

TD Ameritrade’s YouTube channel offers a concise explanation of the difference between stocks and bonds. A much longer explanation is offered in this older Khan Academy video.

TD Ameritrade also offers a concise explanation of how the bond market works and what bonds are used for (spoiler, they’re not just for lame gifts from old uncles).

Applications for Education

Both of these videos could be helpful primers for lessons about the basics of financial markets and lessons about personal finance. With a free EDpuzzle account you can add multiple choice, true/false, and short answer questions into these videos. In this video I provide a complete overview of how to use EDpuzzle to create video lessons using videos that you find online.

Archives