bonds Flashcards
A ___ is a loan investment, which means an investor is actually loaning money to an entity, in exchange for regular interest payments.
bond
Loaning money for regular payment.
bond
An investor who purchases stock _______.
actually owns a piece of that company.
When he buys a ___, he’s buying ownership in a company.
stock
Buying ownership in a company.
stock
_____: ownership, benefits from the growth of the company, profits are paid out in the form of dividends.
stock
_____: loan, benefits from the interest amounts paid for the loan, interest payments are made in the form of coupon payments.
bond
_____ interest-bearing security which promises to pay a stated amount of money on the maturity date, and regular interest payments called coupons.
bond
Regular interest payments called _____
coupon
_____ periodic interest payment that the bondholder receives during the time between purchase date and maturity date; usually received semi-annually
coupon
_____ the rate per coupon payment period; denoted by r
coupon rate
_____ the price of the bond at purchase time; denoted by P
price of a bond
_____ the amount payable on the maturity date; denoted by F
par value or face value
If P=F, the bond is ______.
purchased at par
If P<F, the bond is _____.
purchased at a discount
