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Discount bonds are fixed-income securities that are issued at a lower price than their face value. Since they come at a discount (sometimes very deep discounts), they...
Bond discount is the amount by which the market price of a bond is lower than its principal amount due at maturity. A bond issued at a discount has its...
A discount bond is a debt security sold at a price below its face value, offering capital appreciation upon maturity. Interest rate fluctuations and credit quality influence bond prices. Types of discount bonds include zero-coupon bonds, municipal discount bonds, corporate discount bonds, and treasury discount bonds.
What Is a Bond Discount? A bond discount refers to the difference between the face value of a bond and its current market price when the bond is trading below its face value. This occurs when the bond's coupon rate is lower than prevailing market interest rates.
What is a Discount Bond? A discount bond is a bond that is issued at a lower price than its par value or a bond that is trading in the secondary market at a price that is below the par value. It is similar to a zero-coupon bond, only that the latter does not pay interest until maturity.
Discount bonds are issued for less than their face value. Consider these pros and cons for investors.
Discount bonds are issued at a price below their face value, enabling investors to purchase them at a discount. The discount represents the difference between the purchase price and the face value and reflects the bond's implicit interest or yield.