Zero Coupon Bonds
Definition of 'Zero Coupon Bonds'
For example, you might pay $900 today to get back $1,000 a year later. The difference between what you pay now and what you receive in the future is your return. Zero Coupon Bonds are similar in concept to savings bonds.
Zero Coupon Bonds have an accreted value (not the same as the market value) that increases in a mathematically linear fashion over the life of the bond.
Do you have a trading or investing definition for our dictionary? Click the Create Definition link to add your own definition. You will earn 150 bonus reputation points for each definition that is accepted.
Is this definition wrong? Let us know by posting to the forum and we will correct it.