Coupon Rate Bond
Coupon Rate Bond

See Also:
Common Stock
Company Valuation
Convertible Debt Instrument
Covenant Definition of a Bond Contract
Long Term Debt
Non-Investment Grade Bonds
Owner’s Equity
Par Value of a Bond
Preferred Stocks

Coupon Rate Bond

The coupon rate bond is the annual interest rate the issuer pays to the bondholder. The rate is expressed as a percentage of the bond’s face value. Bond coupon rates are quoted as annual rates, but the bond coupons are typically paid semi-annually.
For example, an investor holding a bond with a $1,000 face value and a 10% annual bond coupon will receive $100 in interest yearly until the bond matures. At maturity the investor will receive the principal, also called the face value or the par value, plus the final coupon payment. Similarly, an investor holding a bond with a $1,000 face value and a 10% semi-annual coupon will receive $50 in interest every six months until maturity.

Bond Coupon Definition

A bond coupon refers to the interest payments the bond issuer pays to the bondholder periodically until the bond matures. Bond coupon rates are quoted as annual rates, but the coupons are typically paid semi-annually. The term “coupon” stems from the days when bondholders would actually tear detachable coupons from the bond certificate and turn them in to the bond issuer on certain dates to redeem the interest payments.
coupon rate bond
 

ARTICLES YOU MIGHT LIKE

IP Valuation & Monetization For The C-Suite

Intellectual Property (IP) defines and protects the sources of goods and services in the marketplace, the products and services offered for sale and the content surrounding such offerings.  Whether trademarks, patents, copyrights, or other IP, it is critical that C-Suite strategy drives and shapes the creation, valuation use and monetization of all its intellectual property.

Read More »

IN CRISIS? GET A STRATEGIC CFO! – CEO Blindspots Podcast

Friend of the firm, Birgit Kamps, recently had Strategic CFO President, Dan Corredor, as a guest on her podcast, CEO Blindspots. CEO BLINDSPOTS HOST: Birgit Kamps. She was speaking five languages by the age of 10, and lived in five countries with her Dutch parents prior to becoming an American citizen. Birgit’s professional experience includes starting

Read More »

SHRM calls ICHRA the 401K for Group Health Benefits

Fed-up with group health insurance? ICHRA is the new way to offer great health benefits and avoid ACA penalties, SHRM calls it the 401K for group health benefits.  In 2020 the Department of Labor, HHS and IRS changed the rules for employer health benefits. They changed the Affordable Care Act mandates and penalties for every

Read More »

JOIN OUR NEXT SERIES

Financial Leadership Workshop

MARCH 28TH-31ST 2022

THE ART OF THE CFO®

Financial Leadership Workshop

Days
Hours
Min

August 7-10th, 2023

SHARE THIS ARTICLE
WIKI CFO® - Browse hundreds of articles