Stocks are the shares of an organization. Investing in stocks is riskier than investing in bonds. The value of the stocks is directly dependent on the performance of the company. It is being traded in the stock market as options trading. Stocks of companies are sold and purchased in the stock market on a regular basis. The values of the stocks depend very much on the rise and fall in the stock market. Bonds are the money loaned to an organization or government in return for the receipt of the promise of interest. Investment in bonds does not increase with the performance of the company, rather the lender receives a fixed interest till the maturity of the bond. On maturity, the amount invested in bonds is returned to the investor. The lender can buy or sell the bonds at a lower or higher face value. Although less riskier than stocks, one has to be careful in the selection of the company.