Sentences with phrase «original bond value»

Nevertheless, you have to regard that these are treated like a stock instead of it having its original bond value especially if you are an investor purchasing after an essential price appreciation.

Not exact matches

And bonds at some well - known companies, like American Express and retailer Neiman Marcus, have been trading at 30 % of their original value.

These securities are known as Original Issue Discount (OID) bonds, since the difference between the discounted price at issuance and the face value at maturity represents the total interest paid in one lump sum.

Bondholders can still recoup their original costs if the value of the interest income the bond has generated is greater than the lost principal value.

Yields and market values will fluctuate, and if sold prior to maturity, bonds may be worth more or less than the original investment.

By storing its surplus export revenues in Treasury bonds, South Korea nudges up the relative value of the dollar against our competitors» currencies, and our trade deficit increases, even though the original transaction had nothing to do with the United States.

In other words, you would buy $ 354.42 more of the International stock index fund and sell $ 107.58 worth of shares of the U.S. stock fund and $ 246.84 of the bonds, so that the percentages return to the original proportions, as shown in the value of the target asset allocation row.

For example, a total return of 20 % means the security increased by 20 % of its original value due to a price increase, distribution of dividends (if a stock), coupons (if a bond) or capital gains (if a fund).

At 3 % inflation, the inflation adjusted principal of a bond or preferred stock falls to 74 % of its original value after 10 years.

The effect of this rule is that a taxpayer who purchases a tax - exempt bond subsequent to its original issuance at a price less than its stated redemption price at maturity (or, if issued with OID, at a price less than its accreted value), either because interest rates have risen or the obligor's credit has declined since the bond was issued, and who thereafter recognizes gain on the disposition of such bond will have part or all of the «gain» treated as ordinary income.

If the bond has face value $ 1100 five years from now and is sold by the issuer for $ 1000 today, then it is not a coupon bond in the usual sense of the word (and it does not have a 10 % coupon) but rather it is a zero - coupon or original issue discount bond.

To expand on @DilipSarwate's comment regarding your first bullet point, if the original face value for the bond is $ 1000, it has a maturity of five years and a coupon rate of 10 %, then each of those five years you will receive $ 100 (10 % of $ 1000) and at the end of the five years you will receive $ 1000 back, for a total outlay of $ 1000 and a total income of $ 1500, netting you $ 500.

The return and principal value of bonds fluctuate with market conditions and when sold, bonds may be worth more or less than their original cost.

a feature of certain debt instruments that allow for the estate of a deceased investor to «put back» or redeem that instrument without penalty; bonds that carry a survivor's option usually redeem for par value when the survivor's option is exercised; in either case the benefit of the survivor's option can not be realized unless the original investor in the asset has died; because investor mortality risk must be taken into account when underwriting assets that carry a survivor's option, these assets are more complex and expensive to issue; also known as a «death put»

An original issue discount (OID) is the discount from par value at the time a bond or other debt instrument is issued; it is the difference between the stated redemption price at maturity and the actual issue price.

However, if the current bond value of your bond dropped to $ 500 from $ 1000, the yield of your bond will be 10 % and you will still be paid $ 50 as per the original agreement.

The Original Issue Discount (OID) form is used to show the bond interest on a bond when issued at a price lower than its maturity value.

Many investors put money in bonds to receive interest income and assume their original investment - their principal - will not change in value.

Zeros are issued at a discount and mature at par value, and the amount of the spread is divided equally among the number of years to maturity and taxed as interest, just as any other original issue discount bond.

This means that holding these bonds until maturity will mean they will only receive half of the original nominal value of the bond, and that is assuming no further write downs occur.

A similar type of bond, known as an «original - issue discount» bond, is issued below par value and may pay out some interest.

The AFR is useful for tax concepts such as Original Issue Discount (when issuers sell low - interest or no - interest bonds or loans at less than face value, attempting to recharacterize interest income as return of principal), various grantor trusts (e.g. GRATs), and so forth.

The net carrying value is the original amount paid for the bond subtracted by previous amortization.

The Principal is the amount borrowed, the original amount invested, or the face value of a bond [2].

Principal may also be used to refer to the face value or original amount of a bond.

Also, savings bonds have an «original maturity» period during which the bond increases in value and becomes worth at least its face amount and an «extended maturity period» during which it continues to earn interest.

At maturity, the original face value of the bond would be multiplied by the cumulative inflation rate registered since the date of issue to obtain the final yield at maturity.

If a guarantee of principal is not provided, the adjusted principal value of the bond to be repaid at maturity may be less than the original principal amount and, therefore, is subject to credit risk.