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Discount windowFacility provided by the Fed enabling member banks to borrow reserves against collateral in the form of governments or other acceptable paper.Discount window Similar MatchesDocumented discount notesDocumented discount notesCommercial paper backed by normal bank lines of credit plus a letter of credit from a bank stating that it will pay off the paper at maturity if the borrower defaults. Such paper is also referred to as L.O.C. paper. Discount yieldDiscount yieldThe yield on a security purchased at a price below its face value. Deep discountDeep discountIn the context of a rights issue, the issue of shares at a price much lower than the current trading price.In most rights issues, the new shares are priced at 10-15 per cent below the current price which is thought to be enough to ensure that existing shareholders take up the rights and buy the new shares.With a deep discount rights issue, the discount can be anything up to 50%. In August 2000 the media company Pearson announced a £1.7bn rights issue to pay for a US acquisition and priced it at a substantial discount. The reasoning was that for a rights issue of this size, and in volatile markets, the discount was necessary to ensure its success. Also, the company is estimated to have saved about £27m in underwriting fees. Discount paymentDiscount paymentThe difference between the face value and the price paid for a security. Deep discount bondDeep discount bondA bond issued with a very low coupon or no coupon that sell at a price far below par value. A bond that has no coupon is called a zero-coupon bond. Further Suggestionsbond discountDividend Discount Return Discounted payback period rule Risk adjusted discount rate discount rate Accrued market discount Discounted cash flow (DCF) Rediscount Discount broker Original issue discount debt (OID debt) Forward discount Discounted in or by market Average discount rate Discount period Forward discount discounted rate mortgage Discounted dividend model (DDM) Volume discount Discounting Discounted basis Original Issue Discount securities (OIDS) Discount Arbitrage Discount bond Discount period Discounted payback |
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