Does anyone know what the rate for a zero coupon is currently getting?
I would like to purchase a zero coupon for a period of 20 years, but not sure if is worth it. Any suggestions?
Posted on January 27, 2010 at 10:21 pm by admin · Permalink
In: Coupon Q&A · Tagged with: zero coupon
In: Coupon Q&A · Tagged with: zero coupon
on January 27, 2010 at 10:21 pm
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A Zero coupon bond doesn’t pay interest, that’s why it’s called a zero coupon. The way you make money is that the bond sells at a deep discount and the money is made when the bond is redeemed at maturity at full face value.
As an example, the zero may have a face value of $1000, but will sell at say $700. It pays no interest over the life of the bond, but when you redeem it, you’ll get the full face value of $1000.
on January 27, 2010 at 10:21 pm
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it depends who issues it