What is the coupon rate?
When the investor buys a bond from the company, the company lends the company in exchange for an agreement to pay interest on money and return the borrowed amount for a specified period of time. The coupon rate, which is also called a coupon, is an annual payment of interest rates for a bond, which is communicated as a percentage of the value of the bond. Some bonds called zero coupon bonds are issued for less than nominal value and do not add any coupon. Instead of regular interest -based interest payments, a higher nominal value is assigned at the end of the time period of the assigned bond. It is basically a promise to repay the borrowed money called the bond director. Bond usually includes interest payment at a defined coupon rate on bonds. The debtor issuing a bond is usually a company and a creditor can be a private party or a broker of securities that buys a bond.
both shares and bonds are securities that allow investors to put money into businesses,whom they believe they benefit. Although stocks are at risk of stock market accidents and major market fluctuations, shareholders always receive money for stocks and dividends they earn. The acceptance of the agreed rate of coupon and payment of principal principal depends on the company's ability to fulfill its financial obligations, so the bond buyer must decide to borrow money carefully on the basis of the beneficiary's credibility. Bonds differ from shares because they have a fixed return on the basis of a bond coupon, as well as a fixed date after the contract for bonds.
More common in fiction than in recent financial trading, bearers, also known as certificates of bearers, bonds issued to a person who physically holds a bond. The asset for investors who wish to maintain an anonymous investment, the wearer's insuction usually does not retain the recording of custody or identity of the buyer. The wearers' bonds were thus named because they were often issued nameless "wearingTeli ", which means that the value of the bond belongs to the person physically holds it. Because their existence is basically outside the record, these bonds often require bond holders to make careful efforts to get coupons.
Lack of keeping records typical of the wearer's binding is in sharp contrast with the more common registered bond. After purchasing a registered bond, the bond company records the buyer's name together with the identification number associated with the buyer with the bond. Registered bonds are less dependent on physical paper binding, because records allowing the replacement of lost, stolen or destroyed bond can be easily found.