Finance Chapter 13, Investing in Bonds
Mortgage Bond
"or Secured Bond", is a corporate bond backed by specific assets as collateral to assure repayment.
Agency Bond
A bond issued by a federal agency
Municiple Bond
A bond issued by the state and local governments.
Junk Bond
A bond that has a low rating, or no rating at all.
Zero-Coupon Bond
A bond that is sold at a deep discount, makes no interest payments, and is redeemable for its face value at maturity.
Callable Bond
A bond that the issuer has the right to pay off before its maturity date.
Tax deferred bond
A bond usually issued by municipal, county, or state governments whose interest payments are not subject to federal and, in some cases, state and local income tax.
Debenture
A corporate bond that is not backd by collateral but by the general credit standing of the corporation.
Convertible Bond
A corporate bond that the bondholder can choose to exchange for shares of the corporation.
General Obligation Bond
A municiple bond backed by the power of issuing state or local government.
Revenue Bond
A municiple bond issued to raise money for a public-works project.
Agency Bond
Your loaning money to an agency.
Coupon Bond
a bond issued with detachable coupons that must be presented to the issuer for interest payments
Registered Bond
a bond registered in the owner's name by the issuing company
Premium Bond
a government bond that bears no interest or capital gains but enters the holder into lotteries
Tax Exempt Bond
sold by local and state governments; interest paid on the bond is not taxed by the federal government
Face Value (Principle)
The amount the bondholder will be repaid at maturity.
Investment-Grade Bond
Any bond with a Baa rating or higher in Moody's, or BBB in Standard & Poor's.
Discount Bond
Bond selling below its par value.
Fixed Income Bond
Fixed income refers to any type of investment under which the borrower/issuer is obliged to make payments of a fixed amount on a fixed schedule: for example, if the borrower has to pay interest at a fixed rate once a year, and to repay the principal amount on maturity.
