Bonds are generally floated by government and public institutions to meet their long term capital requirement. These bonds are generally issued in the form debentures by financial and public listed companies. They are safer than the fixed deposits as they are secured against some of the company's assets. These bonds do have tenure over 3 years. The bonds issued by financial institutions offer attractive interest rates and will have features like safety, liquidity, and good returns. Government also borrows from public in the form of bonds, like RBI Taxfree Bonds, NABARD/NHAI Bonds with capital gains exemption facility etc., The bonds issued are listed for the purpose of liquidity and traded on market exchanges. Price of the bond traded in the market is characterized by various parameters like the current market interest rate, interest rate from the bond (coupon rate), time to maturity, issuing company etc., depending on these parameters, the bond price can command a premium or discount in the market.