How to Report Taxes of a Municipal Bond Bought at a PremiumJoin PRO or PRO Plus and Get Lifetime Access to Our Premium MaterialsThe average annual return over the last ten years was 6.51% as of February 2020. Looking at average annual returns over th... Read more
Amortization of Financing CostsWhen a new bond is issued, it comes with a stated coupon that shows the amount of interest bondholders will earn. For example, a bond with a par value of $1,000 and a coupon rate of 3% will pay annual interest of $30. I... Read more
How bonds workCurrent YieldThe real value of a fixed rate bond is susceptible to loss due to inflation. Because the bonds are long-term securities, rising prices over time can erode the purchasing power of each interest payment a bond makes.What is B... Read more
The amortization of premium on bonds payable — AccountingToolsFirst, it greatly reduces the credit risk of the loan or bond because the principal of the loan is repaid over time, rather than all at once upon maturity, when the risk of default is the... Read more
Indentured ServantsBond IndentureConvertible debentures, which are convertible bonds or bonds that can be converted into equity shares of the issuing company after a predetermined period of time. "Convertibility" is a feature that corporations may ad... Read more
The Top 5 High Yield Bond Funds for 2020The bond market is efficient and matches the current price of the bond to reflect whether current interest rates are higher or lower than the bond's coupon rate. It's important for investors to know why a bond... Read more
ionic bondThis molecular orbital theory represented a covalent bond as an orbital formed by combining the quantum mechanical Schrödinger atomic orbitals which had been hypothesized for electrons in single atoms. A chemical bond is a lasting attractio... Read more
Coupon Rate FormulaYield to Maturity – YTM vs. Spot Rate: What's the Difference?In the United States, the prevailing interest rate refers to the Federal Funds Rate that is fixed by the Federal Open Market Committee (FOMC). The Fed charges this rate w... Read more
When Would a Bond Be Called?How To Evaluate Bond PerformanceCallable bonds are more risky for investors than non-callable bonds because an investor whose bond has been called is often faced with reinvesting the money at a lower, less attractive rate.... Read more
Bill of materialsFor a given product and configuration, some companies use separate systems to structure BOMs for Engineering and Manufacturing purposes. These Engineering Bills of Materials (EBOMs) and Manufacturing BIlls of Materials (MBOMs) can be... Read more
