Bonds Flashcards
Are bonds long or short term?
Very long term
What does bond maturation refer to?
The time when the bond is expected to be paid back
What does yielding refer to?
The percentage of the money the bond provides periodically
What does issue at a premium mean
Going for a higher price
What does semi-annually mean?
Every 6months
What is a bond?
When one is a partial lender to a company
What is financing via equity
When a company issues stocks in order to raise funds
What are various ways a company can raise funds?
Bank loan, financing via equity, bonds
What does maturity date on a bond mean?
The date by which the interest and entire principle value is paid back
How often are bond coupons/interest payments issued?
Semi-annually, every 6months
What does 10% annual coupon mean?
You’re paid 10% interest of the original loan per year, but you’re paid semi-annually
