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Go to your local discount broker, (Schwab, Ameritrade, E*trade, Scottrade) open an account and they will cash it in or liquidate it for you. There will be a fee associated with the transaction. Shop around, prices vary. If they can't (or won't) do it, have them give you the name and address of the transfer agent. You can send it to them to liquidate as well. Good luck.
What else can I help you with?
Is a zero coupon bond a junk bond?
depends on the collateral supporting the bond.
Distinguish between deep discount bond and zero coupon bond?
the main difference between deep discount bond and zero coupon bond is that in case of zero coupon bond no int is payable periodically while in case of deep discount bond int is payable periodically at very lower rate say 2% per annum
What is a Zero coupon bond?
A zero-coupon bond is a bond bought at a price lower than its face value, with the face value repaid at the time of maturity. It does not make periodic interest payments, or have so-called "coupons," hence the term zero-coupon bond.
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.
What are Treasury Bond Strip Rates?
Treasury Bond STRIPS are zero-coupon bonds STRIPPED from regular coupon paying Treasury Securities.Zero - Coupon bonds are simply bond instruments that pay no interim cash flows. Thezero coupon bond is the most simple type of transaction involving only two cash flows:• Money Invested Now (at discount)• Money Returned at Maturity (face amount)As bonds have a typical life longer than one year we tend to compare them on the basis of Yield to Maturity. The YTM of a zero coupon bond is a relatively simple concept that we will deal with in the next few paragraphs.The annual YTM of a five year zero coupon bond is simply the answer to the following question: What rate of interest would I need to earn on each of a series of successive one year investments such that my proceeds at the end of five years would be the same as they would be from having invested in the five year zero coupon bond?On occasion a similar question might be asked with the intention of ascertaining the 'Semi - Annual' YTM of a five year zero coupon bond: What rate of interest would I need to earn on each of a series of successive half - year investments such that my proceeds at the end of five years would be the same as they would be from having invested in the five year zero coupon bond? This half - yearly rate of return is, by market convention, then simply doubled so as to provide a yearly equivalent.More detail can be found on this at www.davidandgoliathworld.com
Is zero coupon bond more sensitive to change in interest rate than fixed coupon bond?
The zero coupon bond is more sensitive to change in rate (inflation) because the market value is not based on a fixed coupon.
Is a zero coupon bond a junk bond?
depends on the collateral supporting the bond.
Distinguish between deep discount bond and zero coupon bond?
the main difference between deep discount bond and zero coupon bond is that in case of zero coupon bond no int is payable periodically while in case of deep discount bond int is payable periodically at very lower rate say 2% per annum
What is a Zero coupon bond?
A zero-coupon bond is a bond bought at a price lower than its face value, with the face value repaid at the time of maturity. It does not make periodic interest payments, or have so-called "coupons," hence the term zero-coupon bond.
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 is your zero coupon bond worth?
That would depend on the specifics of the individual bond.
How is Modified Duration calculated for a Zero Coupon Bond?
3 years zero coupon bond. face value $100 and present market value $75. What will be its Macualay Duration and Modified Duration?
Where does the interest on a 4 year zero coupon go?
It goes to the investor who buys the bond. A zero coupon bond is a bond in which, the investor need not pay any premium (coupon) above the face value of the bond while purchasing it. Let us say a company issues a $10,000 bond at a discount of 10% with zero coupon, it is enough if the investor pays $9000 to buy the bond. At the time of maturity he would get back $10,000. This 10% discount can be compared to the interest earned on the investment for the investor.
What are Treasury Bond Strip Rates?
Treasury Bond STRIPS are zero-coupon bonds STRIPPED from regular coupon paying Treasury Securities.Zero - Coupon bonds are simply bond instruments that pay no interim cash flows. Thezero coupon bond is the most simple type of transaction involving only two cash flows:• Money Invested Now (at discount)• Money Returned at Maturity (face amount)As bonds have a typical life longer than one year we tend to compare them on the basis of Yield to Maturity. The YTM of a zero coupon bond is a relatively simple concept that we will deal with in the next few paragraphs.The annual YTM of a five year zero coupon bond is simply the answer to the following question: What rate of interest would I need to earn on each of a series of successive one year investments such that my proceeds at the end of five years would be the same as they would be from having invested in the five year zero coupon bond?On occasion a similar question might be asked with the intention of ascertaining the 'Semi - Annual' YTM of a five year zero coupon bond: What rate of interest would I need to earn on each of a series of successive half - year investments such that my proceeds at the end of five years would be the same as they would be from having invested in the five year zero coupon bond? This half - yearly rate of return is, by market convention, then simply doubled so as to provide a yearly equivalent.More detail can be found on this at www.davidandgoliathworld.com
PV of 31 year zero coupon bond with a YTM of 8 par Value 1000?
present value zero coupon=1000/(1.08)31
What is the taxation of zero coupon bonds held to maturity?
Zero coupon bonds issued by the US Treasury are issued at a discount to face value. An investor holding zero coupon bonds is paid the full face value when the zero coupon bond matures. The difference between the purchase price and the maturity value is know as the original issue discount which represents the interest earned on the zero coupon bond. Although a zero coupon bond does not pay annual interest, an investor must pay taxes each year based on the imputed receipt of income. Since the investor is not receiving interest payments during the life of the bond, taxes would be paid on interest income not actually received until bond maturity. Due to the yearly tax liability on imputed interest, it makes sense for most investors to hold zero coupon bonds in a tax deferred retirement account. The interest earned on zero coupon bonds issued by the US Treasury are exempt from state and local taxes.
When to cash a zero coupon bond?
A zero coupon bond should be cashed at maturity to receive its full face value, as it does not pay periodic interest. Cashing it before maturity may result in a lower return, as it will typically trade at a discount to its face value. However, if you need immediate cash or if market conditions significantly change, you might consider selling it before maturity. Always assess your financial needs and market conditions before making a decision.
