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Home > QFINANCE Dictionary > Definition of coupon rate

Definition of

coupon rate

Stockholding & Investments

interest rate of bond the rate of interest paid on a bond issued at a fixed rate.

Related definitions of "coupon rate"

Recommended Further Reading (Term count)
  • Minimizing Credit Risk
    by Frank J. Fabozzi
    Financial corporations and investors face several types of risk. One major risk is credit risk. Despite the fact that market participants typically refer to “credit risk” as if it is one-dimensional, there are actually three forms of this risk: credit default risk, credit spread risk, and downgrade risk.Credit default risk is the risk that the issuer will fail to satisfy the terms of the obligation with respect to the timely payment of interest...
  • Capital Budgeting: The Dominance of Net Present Value
    by Harold Bierman, Jr
    A capital budgeting decision is characterized by costs and benefits that are spread out over several time periods. This leads to a requirement that the time value of money be considered in order to evaluate the alternatives correctly. Although to make decisions we must consider risks as well as time value, I restrict the discussion to situations in which the costs and benefits are known with certainty. There are sufficient difficulties in just...
  • Borrowing Costs and Capitalization
    The costs of borrowing are primarily made up of interest and issuance expenses. The interest rate assigned to a particular debt instrument is based on the level of default risk assumed by the investor. Several rating agencies assess the default risk of public debt issuances and provide a rating that is indicative of credit quality. The credit quality is greater for secured/collateralized senior debt than for unsecured subordinated debt issued by...
  • Current Price of a Bond
    The narrow range within which a given bond price falls, based on that bond’s current asking price and bid price.

Definitions of ’coupon rate’ and meaning of ’coupon rate’ are from the book publication, QFINANCE – The Ultimate Resource, © 2009 Bloomsbury Information Ltd. Find definitions for ’coupon rate’ and other financial terms with our online QFINANCE Financial Dictionary.

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