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BondA debt instrument, issued by a borrower and promising a specified stream of payments to the purchaser, usually regular interest payments plus a final repayment of principal. Bonds are exchanged on open markets including, in the absence of capital controls, internationally, providing a mechanism for international capital mobility.BondThe generic name for a tradable loan security issued by governments and companies as a means of raising capital.The bond guarantees its holder:repayment of capital at a future specified date (the maturity date)a fixed rate of interest (also known as the coupon)Government bonds are known as gilts or Treasury Stock.Bonds offer certainty of income, but may fail to keep pace with inflation.As far as the capital is concerned, you only know exactly how much your bond is worth if you plan to hold it to maturity (when you will be paid back the face value). But in the time between issue and maturity, a bond's value can be as volatile as a share, and if you plan to sell before maturity you run the risk of capital erosion. In general:Bond prices fall when bank interest rates go up (because the interest rate rise attracts money out of bonds into cash)Fear of rising inflation will cause bond prices to fall, because investors worry that bonds will not bring enough income to keep pace with inflationThe German and American bond markets have an effect on UK bond prices, because they are competing for the same institutional capital.Similar MatchesInternational bondsInternational bondsA collective term that refers to global bonds, Eurobonds, and foreign bonds. Gold bondGold bondBonds issued by gold-mining companies and backed by gold. The bonds make interest payments based on the level of gold prices. Public purpose bondPublic purpose bondA specific type of municipal bond used to finance public projects such as roads or government buildings. Interest on municipal bonds is federal income tax-free. Bond anticipation note (BAN)Bond anticipation note (BAN)A short-term debt instrument issued by a state or debt instrument to debt instrument against the proceeds of an upcoming bond issue. Variable rated demand bond (VRDB)Variable rated demand bond (VRDB)Floating-rate bond that periodically can be sold back to the issuer. Further SuggestionsArbitrage bondsPickup bond Single state municipal bond fund serial bond Bond indexing Stratified sampling bond indexing Put bond Story stock or bond guaranteed growth bond Stripped bond Accrual bond Chastity bonds Foreign bond Series HH bond Dollar bonds Citizen bonds Private purpose bond Bond agreement junk bonds Bull bear bond Subordinated debenture bond bond interest yield Unamortized bond discount Bond equivalent basis Essential purpose (or function) bond |
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