Yield-to-Call (YTC) is a financial metric used to calculate the yield a bondholder receives if the bond is called at the earliest possible date.
An in-depth exploration of Zero Coupon Bonds, their historical context, types, key events, mathematical formulas, diagrams, and importance in financial markets.
A detailed exploration of Zero Coupon Bonds, their structure, functionality, historical context, importance, applicability, and more.
Zero Coupon Bonds are a type of fixed-income security issued at a discount and repay principal at maturity without periodic interest payments. They can still yield positive returns if purchased at a deep discount.
Zero-coupon bonds are a type of bond that does not pay periodic interest. Instead, they are issued at a discount to their face value and mature at par. Learn more about their types, applications, and historical background.
A comprehensive look at arrearage, covering its definition, applications in finance and investment, historical context, and related terms.
Asset-Backed Securities (ABS) are financial instruments backed by loan paper or accounts receivable originated by banks, credit card companies, or other providers of credit, often enhanced by a bank letter of credit or by insurance coverage provided by an external institution.
Understanding the concept of Below Par pricing, especially in the context of bonds, and its implications for investors.
In finance, a block refers to a large quantity of stock or a large dollar amount of bonds held or traded. Typically, 10,000 shares or more of stock and $200,000 or more worth of bonds are considered a block.
A bond broker is a professional who executes bond trades either on the floor of an exchange or over the counter for corporate, U.S. government, or municipal debt issues, primarily for large institutional accounts.
A comprehensive exploration of bond discount, its causes, implications, and examples, including zero-coupon bonds.
Bonded debt refers to the portion of a corporation's or government's total debt that is represented by issued bonds, highlighting secured financial obligations and their implications.
A comprehensive explanation of the term 'CALL' in Banking, Bonds, and Options, including different types, examples, and comparisons.
A comprehensive guide to understanding Call Premium, its significance in options trading and bonds, including calculation, examples, and related terms.
Call Price refers to the price at which a bond or preferred stock with a call feature can be redeemed by the issuer. It is also known as the redemption price. This entry explores call price, call feature, call premium, and their implications.
Detailed examination of callable securities, financial instruments redeemable by the issuer before the scheduled maturity, typically involving a premium price.
A Certificate of Accrual on Treasury Securities (CATS) is a type of zero-coupon U.S. Treasury security that does not pay periodic interest but is sold at a discount and matures at face value.
The evolution of 'clipping coupons' from a financial habit involving coupon bonds to a modern-day practice of saving money through discounts.
Understanding the Closed Period in Bond Issuance: its importance, implications, and relationship with callable bonds.
An in-depth exploration of Collateralized Mortgage Obligations (CMOs), their structure, types, applications in financial markets, and key considerations.
Convertibles are corporate securities, such as preferred shares or bonds, that can be exchanged for a set number of another form, usually common shares, at a pre-stated price.
An in-depth look at Corporate Bonds, detailing their features, types, historical context, and more.
Understanding the term 'cover' in the context of finance, including its implications in stock trading, corporate finance, and bond safety ratings.
Comprehensive definition of credit encompassing loans, bonds, accounting entries, and tax credits.
A Credit Analyst assesses the financial affairs of individuals or corporations to evaluate their creditworthiness. This professional also determines the credit ratings of corporate and municipal bonds by analyzing financial conditions and trends of the issuers.
Current yield is a measure of the annual interest income generated by an investment, divided by its current market price. It is particularly applicable to bonds, offering a realistic view of return as opposed to other measures such as the coupon rate or yield to maturity.
Debt Financing involves raising capital through borrowing, such as by selling bonds. It is contrasted with Equity Financing, which involves raising capital through the sale of an ownership portion (stock).
A detailed exploration of the debt limit, its implications for municipalities, the process of approving exceeded limits, historical context, related terms, and more.
Comprehensive overview of debt securities, including definitions, types, examples, historical context, applicability, related terms, FAQs and more.
A Deep Discount Bond is a bond sold for a discount of more than about 25% from its face value. Unlike Original Issue Discount bonds, these were issued at par value of $1,000, but market forces led to a significant decline in market value.
An in-depth exploration of defensive securities, including their stability, examples, and role in investment strategies.
A detailed exploration of Deferred Interest Bonds, their features, types, implications, and practical applications.
Comprehensive guide on Discount Bonds, their types, examples, historical context, and comparisons with related financial instruments.
An analysis of the Equivalent Taxable Yield, comparing the taxable yield on a corporate bond and the tax-free yield on a municipal bond, with a focus on implications for investors in different tax brackets.
An in-depth exploration of Eurobonds, bonds denominated in foreign currencies and sold to investors outside their native countries.
A comprehensive overview of Eurodollar Bonds, international bonds issued in U.S. dollars but outside the United States, focusing on their structure, benefits, historical context, and how they function in the financial markets.
An Evaluator is an independent expert who appraises the value of properties with limited trading, like antiques in an estate or rarely traded stocks or bonds. The evaluator's fee can be a flat amount or a percentage of the appraised value.
Understanding the Face Interest Rate on Bonds and Loans
Comprehensive explanation of face value, its significance in financial instruments such as bonds and checks, and comparison with market value.
Financial assets encompass various forms of intangible assets such as stocks, bonds, rights, certificates, and bank balances, distinguishing them from tangible, physical assets like real property.
An in-depth look into fixed income, its types, benefits, risks, and applications.
A comprehensive overview of fixed-income investments, including government, corporate, and municipal bonds, and preferred stock, focusing on their fixed rate of return.
Floating supply refers to the total dollar amount of municipal bonds in the hands of speculators and dealers that is for sale at any particular time, and the number of shares of a stock available for purchase.
A comprehensive explanation of the term 'Full Faith and Credit,' which refers to the complete taxing and borrowing authority pledged for the payment and repayment of government bonds.
A detailed overview of funded debt, emphasizing its definition, types, examples, historical context, and related financial concepts.
Detailed Overview of Gilt: Characteristics, Types, Historical Context, and Applicability in Financial Markets
Detailed insight into the financial and ethical commitments governments undertake including bonds, policies, and regulatory compliance.
An in-depth exploration of government securities issued by the U.S. government, including Treasury bills, bonds, notes, and savings bonds.
A comprehensive overview of Housing Finance Agencies, their functions, operations, and impact on housing assistance in the United States.
Hybrid investments or securities combine characteristics of multiple asset types, such as bonds and derivatives, to offer unique risk-return profiles and benefits.
Ibbotson & Associates, known for providing extensive historical data on financial investments, publishes the annual Stocks, Bonds, Bills & Inflation (SBBI) Yearbook, widely used by investors and analysts.
An Income Fund is a type of mutual fund that aims to generate steady income for its shareholders, typically through a mix of bonds and dividend-paying stocks. This entry explores different types of income funds and their characteristics.
Indenture is a formal agreement, also known as a deed of trust, between an issuer of bonds and the bondholder, covering various considerations like the form of the bond, amount issued, pledged properties, protective covenants, working capital and ratio, and redemption rights.
Comprehensive overview of Inflation-Indexed Securities including definitions, types, historical context, applicability, and related terms.
An in-depth examination of interest-rate risk, its implications for portfolio valuation, examples, and mitigation strategies.
Comprehensive guide on the concept of investment, detailing different types, examples, and key considerations in the pursuit of income or capital gain.
A comprehensive overview of investment strategy, detailing the process and considerations for allocating assets among various investment choices to achieve financial objectives based on individual investor profiles.
Investment-grade bonds are designated by rating agencies such as Standard & Poor's (S&P) as being in the top four credit quality categories (AAA to BBB) and are deemed suitable for purchase by institutional investors such as pension funds, insurance companies, and banks.
An in-depth exploration of the term 'Issue', covering its definitions in finance, genealogy, and law.
An issuer is a legal entity with the power to issue and distribute securities, including corporations, municipalities, foreign and domestic governments, their agencies, and investment trusts.
Junk bonds, also known as high-yield bonds, have a speculative credit rating of BB or lower by Standard & Poor's and Moody's. These bonds are typically issued in leveraged buyouts and other takeovers by companies with short track records or questionable credit strength.
Comprehensive coverage of Kangaroo Bonds, covering their definition, types, special considerations, and historical context. Understand the key aspects and benefits of Kangaroo Bonds in this detailed entry.
Laddering is an investment strategy involving the purchase of bonds that mature at different intervals, providing regular income and mitigating interest rate risk.
A comprehensive overview of listed securities, including their definitions, types, historical context, and differences from unlisted securities.
A long bond is a type of bond that has a maturity date of more than 10 years. This type of bond often yields higher returns due to the increased risk associated with the extended commitment period.
A comprehensive overview of Long Coupon, detailing its definitions, applicability, historical context, and related financial terminology.
A comprehensive overview of Long-Term Debt, its accounting and financial implications, including types, special considerations, examples, and related terms.
The maturity date is a crucial term in finance and insurance that signifies the time at which a bond, life insurance proceeds, or endowment are paid. It can be either at the death of the insured or at the end of the endowment period.
An extensive overview of the Montreal Exchange, Canada's oldest stock exchange specializing in stocks, bonds, futures, and options trading.
A moral obligation bond is a tax-exempt bond issued by a municipality or a state financial intermediary and backed by the moral obligation pledge of a state government. While the state's pledge is not legally binding, it carries significant weight.
A detailed overview of near money, including examples like government securities, bank time deposits, money market fund shares, and bonds close to redemption date.
A comprehensive explanation of new issues, including initial public offerings (IPOs), regulations, and related terms.
Explore the concept of nominal yield, its calculation, types, historical context, real-world examples, comparisons with real interest rate, and FAQs.
A nonrefundable provision in a bond indenture restricts the issuer's ability to retire bonds using proceeds from a subsequent issue, offering protection to bondholders until a specified date.
A comprehensive guide to understanding Original Issue Discount (OID), its implications, and tax treatment.
Understanding the concept of Original Maturity in the context of bonds, including its importance, application, and distinction from current maturity.
An in-depth look at PAR, its importance in finance, the difference between stated value and market value, and its various applications in the world of negotiable instruments, stocks, and bonds.
Comprehensive explanation of POINT Bonds in various financial contexts, including bonds, real estate, commercial lending, and stocks.
Comprehensive coverage of the concept of Positive Carry in financial contexts, including definitions, examples, implications, and related terms.
A comprehensive overview of Premium Bonds, which are bonds sold at a price above their face or redemption value, along with tax amortization details.
A detailed examination of a prepayment clause in a bond or mortgage, outlining its significance, penalties, and related features.
An in-depth explanation of the primary distribution in finance, encompassing the sale of a new issue of stocks or bonds, distinguishing it from secondary distribution.
Understanding the principal amount or face value in the context of financial instruments such as bonds and loans, its implications, taxation, and related concepts.
Public Debt refers to the total amount borrowed by governments to finance expenditures that exceed tax revenues, addressed through instruments like bonds, loans, and treasury bills.
Public Housing Authority Bonds are financial instruments issued by local public housing agencies, secured by an agreement with the Department of Housing and Urban Development. These bonds facilitate funding for local housing projects by ensuring federal loans to cover principal and interest to maturity.
The real interest rate is the current interest rate adjusted for inflation, providing insight into the actual cost of borrowing or the real return on investment. Learn how to calculate it and understand its economic impact.
An in-depth exploration of recapitalization, its types, implications, historical context, examples, and application in modern corporate finance.
Redeemable bonds, also referred to as callable bonds, provide issuers with the flexibility to manage debt efficiently by repaying the bond before its maturity.
An in-depth exploration of the Redemption Price in financial instruments, its significance, calculation, and implications for investors.
Refinance refers to the process of replacing an existing debt obligation with a new one, typically with different terms. This often involves selling a new bond issue to provide funds for redemption of a maturing issue, or placing a new mortgage on a house that retires an old mortgage. Refinancing is generally used to raise cash, reduce interest rates, or both.
A Registered Bond is a type of bond recorded in the name of the holder on the books of the issuer or the issuer's registrar and can be transferred to another owner only when endorsed by the registered owner. Contrast this with Coupon Bonds to understand their differences and functions.
An in-depth examination of registered securities, including their types, special considerations, historical context, and more.
This entry covers the concept of the reinvestment rate - the rate of return from reinvesting the interest earned from bonds or other investments. It details how reinvestment rates differ between zero coupon funds and regular interest-paying bonds.
An analysis of the term 'rich' in financial contexts, including its application to securities, interest rates, and its broader meaning as a synonym for wealth.
A comprehensive guide to understanding the safe rate, which is an interest rate provided by low-risk investments such as high-grade bonds or well-secured first mortgages.
A secured bond is a bond backed by the pledge of collateral, such as a mortgage or other lien. It is vital for investors to understand the security mechanism and distinction from unsecured bonds or debentures.
A comprehensive guide to Secured Debt, its types, advantages, disadvantages, and real-world examples.
Detailed explanation of Securities including types, historical context, examples, and key considerations.
Senior refunding involves replacing securities maturing in 5 to 12 years with new issues having original maturities of 15 years or longer. This process helps reduce interest costs, consolidate issues, or extend maturity dates.
A comprehensive overview of the Series HH Bond, a type of U.S. government bond once available in exchange for Series E or EE bonds, including its history, functions, and cessation.
