A unique type of bond that appears often in CMO issues. The bondholder receives no payments until every other bond in the series has been paid off. The interest payments, that should have been paid over the life but weren’t, get added to the balance of the bond. The next “would-be” interest payment is calculated using that increased bond balance. Also called a “Z-bond” or a “Z-tranche.”
See also: CMO, Zero-coupon bond
Since Toby suspected rates would be going up, he invested inaccrual bonds.
A bond that is backed by loans, leases, accounts receivable, or other debt originally created for the purchase of personal property assets. Cash inflows from the underlying loans, leases, debts, or receivables are distributed to investors. Similar to mortgage-backed securities except that they involve no real estate.
See also: Accounts receivable, Mortgage-backed securities, Personal
Madison put a small amount of money intoasset-backed securitiesto cash
in on their high returns while not exposing her portfolio to too much risk.
The mean interest rate earned on a portfolio of bonds.
See also: Bond, Interest rate
Jim was pleased with theaverage couponon his client’s portfolio because it
was higher than most.
A debt security issued with a par value of less than $1,000 (the standard par value).
See also: Bond
As his first investment, the high school student decided to invest in ababy