Coupon: Difference between revisions
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{{a|glossary|[[File:Transylvanian_Bond.jpeg|center| | {{a|glossary|[[File:Transylvanian_Bond.jpeg|center|400px|thumb|A Transylvanian [[bond]] spotted in Sighișoara yesterday]]}}[[Interest]]. Derives from the traditional means of paying interest on a [[definitive]], security-printed [[bearer bond]], wherein each interest payment was represented by a detachable perforated strip on the side of the [[bond]] - you know, like coupons in the newspaper - which the [[bondholder]] would tear off and present to the [[paying agent]] in return for the interest payment in question. | ||
[[Coupon]] can refer to any [[interest]] payment, under loans, swaps etc, or specifically to the interest payment obligation under a bond as a discrete [[financial instrument]] from its host [[bond]]. Each coupon, once detached, is its own transferable [[promissory note]] , it can trade in the same way as the bond from which it was detached trades. This is called [[coupon stripping]]. | [[Coupon]] can refer to any [[interest]] payment, under loans, swaps etc, or specifically to the interest payment obligation under a bond as a discrete [[financial instrument]] from its host [[bond]]. Each coupon, once detached, is its own transferable [[promissory note]] , it can trade in the same way as the bond from which it was detached trades. This is called [[coupon stripping]]. | ||
Revision as of 06:54, 23 October 2019
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Interest. Derives from the traditional means of paying interest on a definitive, security-printed bearer bond, wherein each interest payment was represented by a detachable perforated strip on the side of the bond - you know, like coupons in the newspaper - which the bondholder would tear off and present to the paying agent in return for the interest payment in question.
Coupon can refer to any interest payment, under loans, swaps etc, or specifically to the interest payment obligation under a bond as a discrete financial instrument from its host bond. Each coupon, once detached, is its own transferable promissory note , it can trade in the same way as the bond from which it was detached trades. This is called coupon stripping.