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What one of these describes a bond?
A bond is a type of investment that represents a loan made by an investor to a borrower, typically the government or a corporation. Bonds have a maturity date when the borrower repays the principal amount along with interest to the investor. Bondholders receive regular interest payments until the bond reaches maturity.
What obligation does a business owner have to a investor who purchases a bond for financing?
Bonds investors are obligated whether in a corporation or government entity to provide a fixed percent rate return and a definite maturity date.
What happens when a yield to maturity is less than the yield to call?
The issuer will call the bonds and issue new bonds to the maturity date.
When the corporation issuing the bonds has the right to repurchase the bonds prior to the maturity date for a specific price the bonds are?
callable bonds
What are three main characteristics of bonds?
Bonds are a form of debt securities issued by governments or corporations. They typically have a specified maturity date when the principal amount is repaid. Bonds pay periodic interest payments to bondholders based on a fixed or floating interest rate. The value of bonds can fluctuate depending on changes in interest rates and the creditworthiness of the issuer.
What is the maturity on junk bonds?
Depends on the individual bond. Look for the date on the certificate.
What are easy exit bonds?
Easy exit bonds are types of fixed-income securities that can be easily sold by the investor before the maturity date. These bonds typically have high liquidity and are traded in secondary markets without significant loss of value. They provide investors with flexibility to exit their investment if needed, compared to traditional bonds that may have restrictions on early sale.
Can you provide examples of debt investments?
Debt investments are financial assets where an investor lends money to an entity in exchange for regular interest payments and the return of the principal amount at a specified maturity date. Examples of debt investments include government bonds, corporate bonds, municipal bonds, certificates of deposit (CDs), and treasury bills.
What is the typical payment structure for most bonds, which usually involves the full repayment of the principal amount at a single maturity date?
The typical payment structure for most bonds involves the full repayment of the principal amount at a single maturity date.
Debt securities sold to investors that must be repaid at a particular date some years in the future are called?
bonds payable
What are the three main characteristics of bonds?
The three main characteristics of bonds are their face value (par value), coupon rate (interest rate), and maturity date (when the bond will be repaid). Bond prices fluctuate based on market interest rates, with higher rates leading to lower bond prices and vice versa. Bonds can be issued by governments, municipalities, or corporations to raise funds.
List the key factors that influence the price on bonds in the secondary market?
Supply and demand,Expectations about interest rates and inflation,The bonds face value,The maturity date,The number of coupons remaining to be paid out before maturity.
