Coupon rateThis is the annual percentage of interest the issuer pays someone who owns a bond. The term "coupon" originates from when bond certificates were issued on paper and had actual coupons that investors
The benefit of a warranty bond is to repay money invested if the work can not be done within the specified time, or if the company or contractor goes bankrupt. For example, if a bonded plumber's business goes bankrupt while installing plumbing on several houses, the warranty bond repays th...
Par value– this is the face value. We also call it theprinciple. It is the sum of money the lender will receive when the bond has reached maturity. In most cases, the par value of bonds are $1,000 or $100. Coupon rate–this isthe percentage rate of interest, which the issuer typ...
Taking the interest rate up by one and two percentage points to 6% and 7% yields bond prices of $98 and $95, respectively. Because the bond price in the example is $95.92, the chart indicates that the interest rate is between 6% and 7%. Having determined the range of rates, investors ...
An origination fee is typically a percentage of your loan that's withheld from the disbursed funds. You can include a portion of this fee as deductible interest. Dividing the origination fee by the number of years you have to pay off the loan gives you the amount you can treat...
Bond Futures and Margin Many futures contracts require margin, meaning a trader needs to deposit and maintain a specific amount in their brokerage account. This amount is generally much smaller than the notional value of the futures contract, and it must be deposited when a futures position is ...
The realized short-term capital loss of your Beta stock can be used first to offset the short-term capital gains realized on the sale of your Acme stock. Then, any excess can be used to offset up to $3,000 of your ordinary taxable income ($1,500 for those who are married filing sep...
This lesser-known way to pay for college requires students to give a fixed percentage of their future salary to a school in exchange for funds. Getty Images Tonio DeSorrento, co-founder and CEO of Vemo Education, a Virginia-based company that helps colleges and universities design and ...
Futures margin is a performance bond designed to cover a small percentage of losses, and a minimum must be maintained daily. Portfolio margin is a risk-based approach designed for active traders with many positions and plenty of equity in their accounts. Let’s begin by looking at three prim...
The key is to build the fund at regular intervals, consistently devoting a certain percentage of each paycheck toward it, and if possible, putting in whatever you can spare on top. This will get you to think about your spending, too. ...