How does investing in bonds differ from investing in stocks? Bonds represent equity while stocks represent debt Bonds provide fixed income, while stocks offer potential for capital gains Bonds require ownership in the issuing company Bonds are higher risk than stocks

## Step 1<br />The question is asking us to identify the correct statement that differentiates bonds from stocks. <br /><br />## Step 2<br />Let's analyze each option:<br /><br />### Option A: <br />This statement is incorrect. Stocks represent equity, meaning they represent ownership in a company. Bonds, on the other hand, represent debt, not equity.<br /><br />### Option B: <br />This statement is correct. Bonds provide fixed income, which means they pay a fixed amount of interest over a specified period. Stocks, on the other hand, offer potential for capital gains, which means they can increase in value over time.<br /><br />### Option C: <br />This statement is incorrect. Bonds do not require ownership in the issuing company. They are essentially a loan to the company.<br /><br />### Option D: <br />This statement is incorrect. Generally, bonds are considered less risky than stocks. This is because bonds have a fixed income and a maturity date, while stocks can fluctuate in value and do not have a maturity date.