A bond is a financial agreement where a borrower promises to pay back a lender the borrowed money plus interest. There are different types of bonds, like fixed coupon bonds and zero-coupon bonds. Bonds are usually priced based on benchmarks and can be affected by changes in interest rates. Longer-term bonds and those with lower interest rates are more sensitive to price changes. The risk of a bond's price changing due to interest rate shifts can be measured using duration.