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Fixed Income Instruments

Zero-coupon Bonds

These bonds are often used as a means of raising long-term capital for a company or government entity. The difference between the discount price and the face value is considered the investor's profit or yield.

Let's delve into the world of finance and explore the concept of zero-coupon bonds. These unique bonds are issued at a discounted price and do not offer any interest payments to the investors. They serve as a popular option for companies and governments to raise long-term capital. The investor's profit or yield is determined by the difference between the discount price and the face value of the bond. This makes zero-coupon bonds a valuable tool in the financial market.

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