Private-sector bonds are debt securities issued by corporations, municipalities, or other private entities to raise capital for various purposes, such as funding new projects, refinancing existing debt, or expanding operations. These bonds typically offer higher yields compared to government bonds, reflecting the increased risk associated with investing in private entities. Investors in private-sector bonds assess factors like credit ratings, the issuing entity's financial health, and market conditions to gauge risk and potential return. The bonds have different maturities and may vary in terms of liquidity and marketability, making them a crucial component of a diversified investment portfolio.