Question

Distinguish between a Bond and a Debenture.

Hint:

Bonds: usually govt/institution-issued, safer. Debentures: company-issued, may be secured/unsecured, sometimes convertible.

Answer 1

Step 1: Set up a simple side-by-side table logic:

Basis	Bond	Debenture
Issued by	Government / public financial institutions	Companies (private or public)
Security	Usually secured / government-backed	May be secured or unsecured
Risk	Generally lower risk	Depends on the issuing company's creditworthiness
Convertibility	Rarely convertible	May be convertible into shares

Step 2: Summarise the underlying idea:
Both are debt instruments acknowledging a loan with fixed interest, but the identity and creditworthiness of the issuer, and the degree of security offered, are what set a bond apart from a debenture in practice.

Final Answer:
The core distinction is the issuer and the security/risk profile — government/institution-backed and typically safer for bonds, versus company-issued and dependent on that company's own credit standing for debentures.