Definitions for "Deep discount bond"
Keywords:  coupon, discount, par, zero, idbi
A long-term debt instrument selling at a high discount of its face value Deep discount bonds inIndia have been floated by IDBI. These bonds have a period of maturity of 25 years. They have a face value of 1,00,000/- and were sold at 2700
a Bond, which is sold at an issue price, which is substantially below its face value
A bond where the market price is less than 20% or so of its face value. Like a zero coupon bond, the market price of a deep discount bond will rise faster when interest rates fall and drop faster when interest rates rise than a bond that is selling close to its face value.
Keywords:  default, premium
Default Default premium