What is generally required to purchase a bond?

When purchasing a bond, what is generally required is an understanding of the bond's terms, which often include a fixed duration until maturity. Bonds typically require an investor to commit their funds for a certain period, as they pay interest at fixed intervals until the maturity date, when the principal amount is returned. This characteristic is inherent to how bonds function—they are debt instruments issued with established maturity dates, which can vary significantly from short-term to long-term horizons.

The other options pose different considerations that do not directly address the fundamental requirements for purchasing a bond. While a bond may be available for a smaller investment compared to some other assets, such as stocks or real estate, it is not generally accurate to label bond purchases as requiring a small initial investment across the board, since the minimum investment can vary widely based on the bond type. Additionally, bonds do not necessarily require a certificate of deposit since they are separate financial instruments with different structures and purposes. Finally, a high-risk tolerance is not a requirement to invest in bonds; in fact, bonds are often considered safer investments compared to stocks, appealing to those with a more conservative risk approach. Understanding the maturity aspect of bonds is crucial for any investor considering these fixed-income securities.