Seach this financial encyclopedia by using the search engine below.
 | Custom Search |
Home | Archives | Blog | Bonds | Credit & Debt | Forex | Futures | Insurance | Investment Fundamentals | Mutual Funds | Options | Real Estate | Stocks | Taxes | Other Investment Topics | New Money Articles
Bonds can be classified as to how ownership is determined.
Bearer bonds, or coupon bonds, have no name or other identifying information on them; interest and principal are paid to the bearer of the bond; hence the name. Because bearer bonds are highly negotiable, they were used in money laundering, so the Tax Act of 1982 ended any new issuance of bearer bonds, but they still exist because of their long lifespan�up to 30 years. They are called coupon bonds because the bond certificates have interest coupons attached to them, which are redeemed biannually at an authorized bank, which will also redeem the bond when it matures if presented.
Registered bonds are registered to the owner. Interest payments, and the principal when the bond matures, are paid to the registered owner by the company or its trustee. Some bonds are registered, but nonetheless have interest coupons attached to them, so sometimes these are referred to as partially registered bonds.
Book entry bonds have no certificate, ownership is tracked by computer. The U.S. Treasury, for instance, has used this method of determining ownership since 1986. Eventually, because of its low cost and easy record access, all ownership will probably be tracked this way.
Bond Ownership
Bond Yields, Credit Risk, Taxable Equivalent Yield (TEY)
Special Bonds - Advanced Refunded Bonds, Put Bonds, Convertible Bonds
Seach this financial encyclopedia by using the search engine below.
| Custom Search |
Copyright © 1982-2008 by William C. Spaulding