Fixed IncomeDefault Risk Premium (DRP) Sinking Fund Non-Parallel Shifts Inverse Floater Diversifiable Risk Underpricing
Bond Par Value
Bondholders are entitled to receive the face value of their bond upon maturity. This refers to the amount that the issuer of the bond has promised to pay back to the bondholder. It is usually set at the time of issuance and remains fixed throughout the life of the bond. The face value, also known as par value or principal, serves as the basis for calculating interest payments and is an important factor in determining the overall yield of a bond. Understanding the concept of face value is crucial in evaluating the potential returns and risks associated with investing in bonds.
Related terms
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