Promissory notes

Promissory notes are fixed income securities that provide income in the form of interest, a promissory note can be a tradeable or a non-tradeable debt instrument. A simple debt agreement is established between two persons when one promises to lend money to the other under certain conditions.

A non-tradeable debt instrument can not change owner, it is tied to the original lender and borrower. A non-tradeable debt instrument are issued to a particular person.

A tradable debt instrument can change hands. Tradeable debt instruments are issued to the holder of a debt instrument. Promissory notes provide income in the form of interest.