Bonds

Bond Indenture vs. Bond Agreement

Bond Indenture vs. Bond Agreement

A bond is essentially a debt that is used as a type of investment vehicle. If you invest in bonds, you are in effect, loaning money to the company issuing the bonds. As the ...

Tax Exempt Securities Vs. Municipal Bonds

Tax Exempt Securities Vs. Municipal Bonds

Tax-exempt securities and municipal bonds are not opposing terms. Municipal bonds are a type of tax-exempt security, and the terms are sometimes used interchangeably. Municipal ...

The Procedures for the Eurobond Issuance Process

The Procedures for the Eurobond Issuance Process

A eurobond is a bond issued in a particular currency, such as euros or dollars, and sold to investors in markets other than the one using the currency of the bond issue. For ...

What Happens When Bonds Drop?

What Happens When Bonds Drop?

Bonds in the secondary market can trade for more or less than their face value -- the contractual amount to be repaid at maturity. Bond prices may drop for several reasons ...

Bond Quotes Explained

Bond Quotes Explained

Bond quotes may differ in format, but they all contain essentially the same information: the bond issuer, the coupon rate, the maturity date, the yield and the current price. ...

Advantages & Disadvantages of Buying Bonds

Advantages & Disadvantages of Buying Bonds

Companies, governments and government agencies issue bonds to raise money for necessary projects. When the bond matures, the issuer pays you back in full, and typically pays ...

How to Calculate Unbiased Expectations Theory

How to Calculate Unbiased Expectations Theory

Unbiased expectations theory predicts future short-term interest rates based on the assumption that long-term interest rates are indicators for the future. This calculation ...

Advantages and Disadvantages of a Deferred Call Provision

Advantages and Disadvantages of a Deferred Call Provision

Sometimes, after a party has issued a bond, it may wish to "call" the bond back. When this happens, the bond issuer is actually retiring all or part of the bond before the bond's ...

How to Amortize a Bond Premium Using the Straight Line Method

How to Amortize a Bond Premium Using the Straight Line Method

If a bond is purchased at a price higher that the face amount, a premium has been paid. For example, if an investor pays $110,000 for a $100,000 bond, he has paid a premium. An ...

Serial Bonds vs. Sinking Fund Bonds

Serial Bonds vs. Sinking Fund Bonds

The strategies implicit in the structure of sinking fund bonds and serial bonds have to do with the retirement of corporate or municipal debt. All bond structures are governed by ...

How to Calculate Semi-Annual Bond Yield

How to Calculate Semi-Annual Bond Yield

Bonds are generally long-term investment vehicles. They take several years to mature, and they earn interest during each year the investor holds onto them. Many bonds pay interest ...

Advantages & Disadvantages to Issuing Bonds in Order to Raise Capital

Advantages & Disadvantages to Issuing Bonds in Order to Raise Capital

Companies that need money for projects or general operations have the option of offering bonds to the public. The bonds are like IOUs for a large number of small loans, which the ...

What Is the Difference Between Bonds & Equity in a Stock Portfolio?

What Is the Difference Between Bonds & Equity in a Stock Portfolio?

Financial planning experts recommend that an investment portfolio balance holdings among stocks, bonds and cash. The stock holdings are the equity portion of a portfolio. Bonds ...

How to Calculate a Savings Bond Maturity Date

How to Calculate a Savings Bond Maturity Date

U.S. savings bonds are long term savings certificates issued by the U.S. Treasury. The traditional series EE savings bonds earn a fixed rate of interest until a bond is redeemed ...

The Average Rate of Return of a Bond

The Average Rate of Return of a Bond

While many novice investors understand the basics of the stock market, many have an understanding of the bond market that’s hazy at best. It’s understandable, as bond ...

Common Stock Vs. Preferred Stock Vs. Bonds

Common Stock Vs. Preferred Stock Vs. Bonds

Dividend paying common stocks, preferred stock shares and bonds each offer income-seeking investors various advantages and pitfalls. For the knowledgeable investor, selecting ...

Long-term vs. Short-term Bonds Problems

Long-term vs. Short-term Bonds Problems

Bonds have an image of safety. Buy them and put them away -- they're bonds. They're safe. Bonds are conservative investments, that is true; however, they are subject to interest ...