The types of investors who typically buy zero-coupon bonds include:
Individuals who are looking for a higher rate of return than what they can get from traditional savings accounts or certificates of deposit (CDs)
Retirement account holders, such as 401(k)s and individual retirement accounts (IRAs), who want to reinvest the principal and interest payments they receive into additional bonds
Investors who are looking for a low-risk investment that offers a higher yield than government bonds or treasury bills