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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 MatchesBond equivalent yieldBond equivalent yieldBond yield calculated on an annual percentage rate method. Differs from annual effective yield. Lehman Brothers Aggregate Bond IndexLehman Brothers Aggregate Bond IndexA benchmark index made up of the Lehman Brothers Governmen../../finance-glossary/Corporate Bond Index, Mortgage-Backed Securities Index, and Asset-Backed Securities Index, including securities that are of investment-grade quality or better, have at least one year to maturity, and have an outstanding par value of at least $100 million. Bonds Enabling Annual Retirement Savings (BEARS)Bonds Enabling Annual Retirement Savings (BEARS)Holders of BEARS receive the face value of bonds underlying call option, which are exercised by CUBS (an acronym for Calls Underwritten by Swanbrook). If the calls are exercised by CUBS, BEARS holders receive the total of the exercise price. Bond anticipation noteBond anticipation noteIn the US, a short term municipal or state note which is repaid from the proceeds of a forthcoming issue. Single payment bondSingle payment bondA bond that makes only one payment of principal and interest. Further SuggestionsInternational bondsShort bonds long bond Refunded bond serial bond I bonds Pickup bond Term bonds samurai bond Super sinker bond Indexed bond Brady bond Performance bond Essential purpose (or function) bond Treasury bonds Bond of Indemnity Conflict between bondholders and stockholders Private purpose bond Joint bond Positive covenant (of a bond) Equivalent bond yield Bond value Government bond Reorganization bond Overhanging Bond |
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