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A bond is a type of a debt security, the approved issuer owes the holders a debt. The repayment period is often an agreement between the issuer and the holder.
A bond selling for less than its face value is classified as being sold at a discount. A bond can sell at a discount if interest rates increase or if the repayment ability of the bond issuer becomes questionable due to a reduction in the credit rating of the issuer.
The coupon rate.
The bond which are obligated to get paid their principal and interest from issuer or its project through the revenue collection are known as "Revenue Bonds". Usually, issuer issues bonds for certain "project" and he requires capital investment hence he issues revenue bonds and the issuer pays back the interest and principal of the bonds through the receipt of the project i.e; through the revenue earned by the project.
A bond issuer's probability of defaulting
A put option is at the discretion of the holder(owner) of the bond to put (sell) the bond back to the issuer for redemption. A mandatory tender is at the discretion of the issuer of the bond to require that the holder sell the bond back to the issuer (usually at par).
A bond is an instrument of indebtedness of the bond issuer to the holders. The issuer owes the holders a debt and pays them interest.
A bearer bond is a negotiable loan instrument which is payable to its holder by the issuer according to preset conditions.
When a bond matures the issuer has to pay the investor the full face value of the bond. The bond will also have a stated interest rate. If an investor will only accept a rate of interest which is higher than the stated interest rate, the issuer will likely sell the bond for less than the present value of the face value of the bond. For example, If a $100,000 bond is issued with a $4,000 discount to meet the buyers desired return, the issuer will have to pay the investor the $96,000 ($100,000-$96,000) the issuer received plus the $4,000 discount upon maturity. Since the issuer has to pay out that $4,000, upon maturity, to secure $96,000 the $4,000 discount is recognized by the issuer as interest expense (over the life of the bond).
A bond is a type of a debt security, the approved issuer owes the holders a debt. The repayment period is often an agreement between the issuer and the holder.
A bond selling for less than its face value is classified as being sold at a discount. A bond can sell at a discount if interest rates increase or if the repayment ability of the bond issuer becomes questionable due to a reduction in the credit rating of the issuer.
The interest rate paid on a bond is known as the coupon rate. A $1,000 fixed rate bond with a 5% coupon rate purchased at par would yield $50 annually in interest payments.
A bond is a type of a debt security, the approved issuer owes the holders a debt. The repayment period is often an agreement between the issuer and the holder.
A bond is a type of a debt security, the approved issuer owes the holders a debt. The repayment period is often an agreement between the issuer and the holder.
Coupon
The coupon rate.
The bond which are obligated to get paid their principal and interest from issuer or its project through the revenue collection are known as "Revenue Bonds". Usually, issuer issues bonds for certain "project" and he requires capital investment hence he issues revenue bonds and the issuer pays back the interest and principal of the bonds through the receipt of the project i.e; through the revenue earned by the project.