India, Sept. 13 -- Most Indian households are familiar with stocks, gold, and fixed deposits. What often gets overlooked is the role of bonds. For years, they've been seen as a backroom instrument, meant for banks and big institutions. Yet if you step back and look at today's financial landscape, bonds might be the missing piece for ordinary investors who want stability without giving up on returns.

Bonds are promise-to-pay fixed-income instruments issued by the government or corporations to fund capital expansion, boost liquidity, or prepay debt.

When you buy a bond, you are essentially lending money to a company or the government. In exchange, you receive regular interest at a predetermined interval and your capital back at maturity. ...