Stocks Buying a share of stock is like buying a tiny piece of the company. Its value can rise or fall.
Bonds Buying a bond is like giving a loan to a government or company. They pay you regular interest until they return your money.
Index Funds An index fund is an investment that buys the stocks or bonds that make up a market index, like the S&P 500®. Instead of buying individual stocks or bonds, you can buy a single index fund that holds dozens or hundreds of investments.