1) Stocks are shares of ownership in a company which makes money from its operations or profits. The price of a stock rises and fall, depending on how well the company does and the perceived future value. Stock derivatives, (Exchange-traded funds, Options, and Future contracts), have grown in popularity. While potentially more affordable, derivatives are speculative moves of stocks or other investment types.
2) Bonds are interest-bearing debt security issued by governments or corporations. Bonds are sold at a fixed yield and pay coupons or interest. A bond must be paid back to the investor at a named date, usually several years later. Government bonds tend to be more stable than corporate bonds.