Coupon Rate

For example...
5% (coupon rate) x $1,000 (face value) = $50 every year.

Bonds pay more interest if

  • (Credit Quality) If the issuer has a poor credit rating,
    the risk of default is greater
  • (Time to maturity) Very long maturity date bonds is exposed to interest rate and inflation for an extended period

Created:2023-10-14