"Zero-coupon" Pronounce,Meaning And Examples

"Zero-coupon" Meaning

A zero-coupon bond is a bond that does not pay periodic interest payments to the bondholder. Instead, the investor buys the bond at a discount to its face value and receives the face value at maturity, effectively earning the difference as interest.

"Zero-coupon" Examples

Example Sentences for "zero-coupon"

In the bond market, a zero-coupon bond is a type of bond that buyers purchase at a discount, earning the difference as interest through the sinking fund.
The practice of zero-coupon bonds eliminates periodic coupon payments to the bondholder in favor of one large lump sum at maturity.
Zero-coupon bonds are often used for financing long-term needs, such as organizing purchase liquidity for business acquisitions.
Zero-coupon convertible bonds combine a bond's investment with the potential to convert the bond into equities when a certain set of investor-friendly regulatory conditions are met.
Zero-coupon in a broader sense might refer to any financial instrument or investment that offers no-interest dividend, such as certain index funds and similar types of investments.