The simplest and the least risky asset is a government bond, issued by a reliable government. The bond is issues for, say, 30 years and every year it pays a sum called the cupon. The original investment is called the principal. The day that the investor gets the principal back (the bond is said to mature) is called the date of maturity. The effective interest rate implied by the market price is called the yield of the bond and this can be very different from the cupon. (Don't really understand this last definition.)
A zero-cupon bond is a bond which pays no interest but instead just returns the investor his investment on the date of maturity.
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