A government bond is a debt instrument issued by a government to support spending and obligations. When you purchase a government bond, you're essentially lending money to the government in exchange for periodic interest payments and the return of the principal at maturity. While mutual funds might hold government bonds within their portfolios, the two are not the same. A mutual fund is a pooled investment product that can hold many types of assets — including stocks, corporate bonds, and government bonds — depending on its investment goals. Confusing a mutual fund with a government bond overlooks this important structural difference. Bonds are individual securities with fixed terms, whereas mutual funds are diversified vehicles composed of multiple assets. Understanding this distinction helps clarify how different financial tools serve unique roles in a portfolio — one being a building block (a bond), the other a basket (a fund).