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Q: How much is the equivalent return on a premium bond?
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When the market rate of return for a particular bond is much less than its coupon rate the bond is selling at?

If the current interest rate is lower than the coupon rate, a bond will be priced at a premium. For example, a bond originally issued at par with a 5% coupon would initially yield 5% to an investor. If market rates subsequently dropped to 3%, the bond would be selling at a premium to reflect the lower interest rate. In this example, the original bond sold for $1,000 and had a coupon rate of 5% to yield $50 per year in interest. If interest rates dropped to 3%, the price of the bond would increase to approximately $1,667. A purchaser of the bond would still receive $50 per year in interest which would provide an annual yield of 3% ($50/$1,667 = 3.0%).


If you have an lic policy whose first quaterly premium has been paid if the policy is canceled by the holder will there be any money back of the premium paid?

It very much depends on the type of life insurance and the terms of the specific policy. In general, however, if it is a term policy, which has no surrender value, there will be no return of the premium because your life was insured for the first quarter of the policy, so you received value (coverage) for the payment you put in.


What is better a stock or a bond?

That depends on the goals of the purchaser. Bonds return a fixed rate of interest income. Stocks generally return a fluctuating rate of interest income, and thus have the capacity to return more money, both as dividends and increased (resale) value of the stock itself.However, stocks also have the potential to decrease in value, which is not true of the bond market.Finally, if the company folds or goes bankrupt, bond-holders will be the first people to be repaid the value of their bonds (since bonds are debts owed to the bond-holder), while stockholders will not be repaid (since stocks are shares of ownership, not debts).If you want to risk your money for the sake of earning more, buy stocks. If you don't want to risk as much and are willing to settle for a lower rate of return, buy bonds -- even then, beware, because a company that goes bankrupt may not have enough money left over to pay even the bond-holders.


How do bondholders get a return on zero coupon bonds?

Zero coupon bonds do not pay interest and are therefore sold at a steep discount to face value depending on the maturity date of the bond. Due to the time value of money, the discount on a 30 year zero coupon bond will be much greater than on a 10 year zero coupon bond. At maturity bondholders will receive the full face value of the bond which provides bondholders a return. For example, a 30 year zero coupon bond with a face value of $1,000 and sold for $500 would return a $500 profit after 30 years. Holders of zero coupon bonds can sell the bonds at any time before maturity. If an investor bought zero coupon bonds prior to a steep drop in interest rates, the value of the zero coupon bonds would increase and could be sold at a profit.


How much does an investment administrator make?

how much do bond traders make

Related questions

How much is bond insurance?

Bond insurance can vary based on the coverage you recieve. Checkign aroudn with a few companies and getting some quotes can help you figure out what the premium will be for oyu.


How much does to get surety bond?

Most license & permit surety bonds will run an average of 1-3% premium depending on the type and bond amount however if credit is an issue they can get quite a bit more expensive. Contact me today to find out options to high premium such as co-signers and/or collateral.


How much is a surety bond?

Most license & permit surety bonds will run an average of 1-3% premium depending on the type and bond amount however if credit is an issue they can get quite a bit more expensive. Contact me today to find out options to high premium such as co-signers and/or collateral.


When the market rate of return for a particular bond is much less than its coupon rate the bond is selling at?

If the current interest rate is lower than the coupon rate, a bond will be priced at a premium. For example, a bond originally issued at par with a 5% coupon would initially yield 5% to an investor. If market rates subsequently dropped to 3%, the bond would be selling at a premium to reflect the lower interest rate. In this example, the original bond sold for $1,000 and had a coupon rate of 5% to yield $50 per year in interest. If interest rates dropped to 3%, the price of the bond would increase to approximately $1,667. A purchaser of the bond would still receive $50 per year in interest which would provide an annual yield of 3% ($50/$1,667 = 3.0%).


How much is the surety bond?

Most license & permit surety bonds will run an average of 1-3% premium depending on the type and bond amount however if credit is an issue they can get quite a bit more expensive


How does a bail bondsman earn money?

In much the same way as an insurance company earns money. A bail bond is basically an insurance contract paid for by an arrested person to get out of jail before trial. The person pays a premium for the bond based on the amount of the bond. If the person shows up for trial, the bondsman keeps the premium. But, if the person skips town the bondsman will have to forfeit the entire amount of the bond to the state of federal government. It works like life insurance only instead of the insurer/bondsman paying the face amount of the policy on the death of the insured, the bondsman pays it on the faiure of the person to show for trial.


What does it mean when one has market risk premium?

When one has market risk premium he/she is willing to take an financial risk. The risk premium is how much value stocks should return over a risk-free investment. Stocks are considered a higher financial risk (and possible a faster gain) opposed to, for instance, bonds.


What can be calculated on the Immediate Annuities website?

The Immediate Annuity Calculator calculates the amount of monthly income you will receive in return for a specific Premium. One can also find how much Premium would be necessary in order to receive a specific monthly income amount.


If your bail is 100000 how much is the bond?

It really depends on what state you are in. Typically the bond premium (the amount you pay a bail agent) is between 10%-15% of the bond. So in the case of a $100,000 bond, you would pay somewhere between $10,000 - $15,000. In addition to the premium, you will most likely have to put up other assets equivalent to the total bond as collateral with the bail agent. Ultimately if the person fails to show up for court the bondsman is responsible for the full amount of the bond ($100,000). This is the value that bail agents bring to the criminal justice system. By letting someone out of jail pretrial, and financially binding them and others (family, friends, bail agent, etc.) the person is more likely to show up in court to have their case heard. Without this financial accountability and the bail agent to ensure their appearance, most people would never show up at court (much like they don't when released through government sponsored "free bail" programs).


Is fit better than premium?

no a premium is a little better than the fit cause premium bikes dont break that much


How do you find a prisoner bond?

How much is my bond


How do you get premium on Neopets?

The best way to go about getting a premium account is asking for a referral from a user that already has premium. The user can tell you what premium offers, how much it is, and is it really worth it.