Discount payment


 

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Discount payment

The difference between the face value and the price paid for a security.



Discount payment

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Straight Discount

Straight Discount

The rate applied to the face value of the promissory note to calculate present value without compounding. For example, a note with a face value in three years of 100, with a straight discount of 10% per annum has a present value of 70.


Forward discount

Forward discount

A currency trades at a forward discount when its forward price is lower than its spot price.


Discounted dividend model (DDM)

Discounted dividend model (DDM)

A formula to estimate the intrinsic value of a firm by figuring the present value of all expected future dividends.


Volume discount

Volume discount

A reduction in price based on the purchase of a large quantity.


Discount yield

Discount yield

The yield or annual interest rate on a security sold to an investor at a discount. A bond that is sold at $4875 that matures to $5000 has a discount of $125. To calculate the discount yield: (discount divided by the face value of the security) multiplied by the (number of days in the year divided by the number of days to maturity).


Further Suggestions

Pure discount bond
Discounted basis
Stepped discount mortgage
Documented discount notes
Discount period
Discount window
Discount rate
discount
Deep discount bond
Discounted cash flow (DCF)
Discount securities
Forward discount
Discount period
Rediscount
Original issue discount debt (OID debt)
Discounted payback
Unamortized bond discount
Underwriters discount
discount rate
bond discount
Accretion (of a discount)
Discount Interest
Discount Points
Discounted in or by market
dividend discount model


 
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