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Bondholder
In finance, a bond is a type of security under which the issuer (debtor) owes the holder (creditor) a debt, and is obliged – depending on the terms – to repay the principal (i.e. amount borrowed) of the bond at the maturity date as well as interest (called the coupon) over a specified amount of time. The interest is usually payable at fixed intervals: semiannual, annual, and less often at other periods. Thus, a bond is a form of loan or IOU. Bonds provide the borrower with external funds to finance long-term investments or, in the case of government bonds, to finance current expenditure. Bonds and stocks are both securities, but the major difference between the two is that (capital) stockholders have an equity stake in a company (i.e. they are owners), whereas bondholders have a creditor stake in a company (i.e. they are lenders). As creditors, bondholders have priority over stockholders. This means they will be repaid in advance of stockholders, but will rank behind secure ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Bond
A government bond or sovereign bond is a form of bond issued by a government to support public spending. It generally includes a commitment to pay periodic interest, called coupon payments'','' and to repay the face value on the maturity date. For example, a bondholder invests $20,000, called face value or principal, into a 10-year government bond with a 10% annual coupon; the government would pay the bondholder 10% interest each year and repay the $20,000 original face value at the date of maturity (i.e. after 10 years). Government bonds can be denominated in a foreign currency or the government's domestic currency. Countries with less stable economies tend to denominate their bonds in the currency of a country with a more stable economy (i.e. a hard currency). When governments with less stable economies issue bonds, there is a possibility they will be unable to repay bondholders, resulting in a default. All bonds carry a default risk. International credit rating agencies p ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Bond
A government bond or sovereign bond is a form of bond issued by a government to support public spending. It generally includes a commitment to pay periodic interest, called coupon payments'','' and to repay the face value on the maturity date. For example, a bondholder invests $20,000, called face value or principal, into a 10-year government bond with a 10% annual coupon; the government would pay the bondholder 10% interest each year and repay the $20,000 original face value at the date of maturity (i.e. after 10 years). Government bonds can be denominated in a foreign currency or the government's domestic currency. Countries with less stable economies tend to denominate their bonds in the currency of a country with a more stable economy (i.e. a hard currency). When governments with less stable economies issue bonds, there is a possibility they will be unable to repay bondholders, resulting in a default. All bonds carry a default risk. International credit rating agencies p ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Coupon (bond)
In finance, a coupon is the interest payment received by a bondholder from the date of issuance until the date of maturity of a bond. Coupons are normally described in terms of the "coupon rate", which is calculated by adding the sum of coupons paid per year and dividing it by the bond's face value. For example, if a bond has a face value of $1,000 and a coupon rate of 5%, then it pays total coupons of $50 per year. Typically, this will consist of two semi-annual payments of $25 each. History The origin of the term "coupon" is that bonds were historically issued in the form of bearer certificates. Physical possession of the certificate was (deemed) proof of ownership. Several coupons, one for each scheduled interest payment, were printed on the certificate. At the date the coupon was due, the owner would detach the coupon and present it for payment (an act called "clipping the coupon"). The certificate often also contained a document called a ''talon'', which (when the origin ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Security (finance)
A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any form of financial instrument, even though the underlying legal and regulatory regime may not have such a broad definition. In some jurisdictions the term specifically excludes financial instruments other than equities and Fixed income instruments. In some jurisdictions it includes some instruments that are close to equities and fixed income, e.g., equity warrants. Securities may be represented by a certificate or, more typically, they may be "non-certificated", that is in electronic ( dematerialized) or "book entry only" form. Certificates may be ''bearer'', meaning they entitle the holder to rights under the security merely by holding the security, or ''registered'', meaning they entitle the holder to rights only if they appear on a secur ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Corporate Bond
A corporate bond is a bond issued by a corporation in order to raise financing for a variety of reasons such as to ongoing operations, M&A, or to expand business. The term is usually applied to longer-term debt instruments, with maturity of at least one year. Corporate debt instruments with maturity shorter than one year are referred to as commercial paper. Definition The term "corporate bond" is not strictly defined. Sometimes, the term is used to include all bonds except those issued by governments in their own currencies. In this case governments issuing in other currencies (such as the country of Mexico issuing in US dollars) will be included. The term sometimes also encompasses bonds issued by supranational organizations (such as European Bank for Reconstruction and Development). Strictly speaking, however, it only applies to those issued by corporations. The bonds of local authorities ( municipal bonds) are not included. Trading Corporate bonds trade in decentrali ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Secondary Market
The secondary market, also called the aftermarket and follow on public offering, is the financial market in which previously issued financial instruments such as stock, bonds, options, and futures are bought and sold. The initial sale of the security by the issuer to a purchaser, who pays proceeds to the issuer, is the primary market. All sales after the initial sale of the security are sales in the secondary market. Whereas the term primary market refers to the market for new issues of securities, and " market is primary if the proceeds of sales go to the issuer of the securities sold," the secondary market in contrast is the market created by the later trading of such securities. With primary issuances of securities or financial instruments (the primary market), often an underwriter purchases these securities directly from issuers, such as corporations issuing shares in an IPO or private placement. Then the underwriter re-sells the securities to other buyers, in what is r ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Medallion Stamp
In the United States, a medallion signature guarantee is a special signature guarantee used primarily when a client transfers or sells US securities. It is an assurance by the financial institution granting the guarantee that the signature on the transaction is genuine and that the guarantor accepts liability for any forgery. Guarantee A medallion signature guarantee is a guarantee by the transferring financial institution that the signature is genuine and the financial institution accepts liability for any forgery. A medallion signature guarantee protects shareholders by preventing unauthorized transfers and possible investor losses. A medallion signature guarantee also limits the liability of the transfer agent who accepts the certificates. A medallion signature guarantee is a binding warranty, issued by an agent of the authorized guarantor institution, that: (a) the signature was genuine; (b) the signer was an appropriate person to endorse, and (c) the signer had legal capa ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Liquidity
In business, economics or investment, market liquidity is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price. Liquidity involves the trade-off between the price at which an asset can be sold, and how quickly it can be sold. In a liquid market, the trade-off is mild: one can sell quickly without having to accept a significantly lower price. In a relatively illiquid market, an asset must be discounted in order to sell quickly. Money, or cash, is the most liquid asset because it can be exchanged for goods and services instantly at face value. Overview A liquid asset has some or all of the following features: It can be sold rapidly, with minimal loss of value, anytime within market hours. The essential characteristic of a liquid market is that there are always ready and willing buyers and sellers. It is similar to, but distinct from, market depth, which relates to the trade-off between quantit ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Bond Valuation
Bond valuation is the determination of the fair price of a bond. As with any security or capital investment, the theoretical fair value of a bond is the present value of the stream of cash flows it is expected to generate. Hence, the value of a bond is obtained by discounting the bond's expected cash flows to the present using an appropriate discount rate. In practice, this discount rate is often determined by reference to similar instruments, provided that such instruments exist. Various related yield-measures are then calculated for the given price. Where the market price of bond is less than its face value (par value), the bond is selling at a discount. Conversely, if the market price of bond is greater than its face value, the bond is selling at a premium. For this and other relationships between price and yield, see below. If the bond includes embedded options, the valuation is more difficult and combines option pricing with discounting. Depending on the type of option, th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Finance
Finance is the study and discipline of money, currency and capital assets. It is related to, but not synonymous with economics, the study of production, distribution, and consumption of money, assets, goods and services (the discipline of financial economics bridges the two). Finance activities take place in financial systems at various scopes, thus the field can be roughly divided into personal, corporate, and public finance. In a financial system, assets are bought, sold, or traded as financial instruments, such as currencies, loans, bonds, shares, stocks, options, futures, etc. Assets can also be banked, invested, and insured to maximize value and minimize loss. In practice, risks are always present in any financial action and entities. A broad range of subfields within finance exist due to its wide scope. Asset, money, risk and investment management aim to maximize value and minimize volatility. Financial analysis is viability, stability, and profitability asse ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Municipal Bond
A municipal bond, commonly known as a muni, is a Bond (finance), bond issued by state or local governments, or entities they create such as authorities and special districts. In the United States, interest income received by holders of municipal bonds is often, but not always, exempt from federal and state income taxation. Typically, only investors in the highest tax brackets benefit from buying tax-exempt municipal bonds instead of taxable bonds. Taxable equivalent yield calculations are required to make fair comparisons between the two categories. The U.S. municipal debt market is relatively small compared to the corporate market. Total municipal debt outstanding was $4 trillion as of the first quarter of 2021, compared to nearly $15 trillion in the corporate and foreign markets. Local authorities in many #In other countries, other countries in the world issue similar bonds, sometimes called local authority bonds or other names. History Municipal debt predates corporate debt b ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Supranational Union
A supranational union is a type of international organization that is empowered to directly exercise some of the powers and functions otherwise reserved to states. A supranational organization involves a greater transfer of or limitation of state sovereignty than other kinds of international organizations. The European Union (EU) has been described as a paradigmatic case of a supranational organization, as it has deep political, economic and social integration, which includes a common market, joint border control, a supreme court, and regular popular elections. Another method of decision-making in international organisations is intergovernmentalism in which state governments play a more prominent role. Origin as a legal concept After the dropping of atomic bombs on Hiroshima and Nagasaki in August 1945, Albert Einstein spoke and wrote frequently in the late 1940s in favour of a "supranational" organization to control all military forces except for local police forces, i ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
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