If you issue a bond at other than its face, or par, value, you must amortize the difference between the issue price and par. A premium bond sells for more than par; discount bonds sell below par.

Steven Nickolas is a freelance writer and has 10+ years of experience working as a consultant to retail and institutional investors. Amy is an ACA and the CEO and founder of OnPoint Learning, a ...

Yield basis represents bond prices as yield percentages, simplifying comparisons between fixed-income securities. Learn how ...

When a bond has an interest rate that's higher than prevailing rates in the bond market, it will typically trade at a price higher than its face value. Such a bond is said to trade at a premium, and ...

The carrying value of a bond refers to its face value, plus any unamortized premiums or minus any unamortized discounts. We can quickly calculate a bond's carrying value with only a few pieces of ...

A municipal bond’s embedded call option allows the issuer of the bond to “call” (i.e., pay back) the debt at a date prior to the bond’s final maturity, which allows the issuer to reduce the cost of ...

Interest Rate Risk Interest rates and bond prices have an inverse relationship - when interest rates rise, bond prices fall, and vice versa. Therefore, if you need to sell your bond before maturity ...