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Face Value (par value or principal) is the cash payable to bondholders at maturity. Coupon Rate is the contractual interest rate. Market Rate of Interest is the rate demanded by purchasers (given risks associated with future cashflow obligations). Effective Interest Rate (borrowing rate) is the market rate at issuance.
1 Comment
10/27/2019 11:03:41 am
When you mentioned “Face Value”, I thought we were talking about a face of a certain person. I was wondering what connection it has in the world of stocks. Well, if I want to take it seriously, then there are still a lot of jargons that I need to learn and I don’t think it’s going to be easy! Hopefully, we could be all given the chance to explore this world because it’s true that there’s more to monetary stuff that we can get from it! Leave a Reply. |
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