Stock values are derived by discounting dividends, bond values by discounting interest coupon payments.
When interest rates were higher, fund managers could offset bond losses with coupon payments from higher-yielding bonds.
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Defaulting on those obligations, including coupon payments to bond holders, would cause severe hardship for the US economy.
The biggest gains on U.S. government debt has come from capital gains pops in the bond price, not reinvested coupon payments.
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With large coupon payments due this week, Greece has been forced into talks with its European counterparts over another tranche of aid.
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There are plenty of hospitals, nursing homes, toll roads, stadiums, small parking projects and school districts that are struggling to make their coupon payments.
Study their structures, final maturities and minimum coupon payments (if any).
The lower the tranche the higher its coupon payments--and the sooner its owners get hit with losses if the mortgages behind the CMO start to default.
The rumored incentives include preferential status for agreeable parties, higher coupon payments should they agree to roll bonds over and the payment of collateral as a token of good faith.
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Indeed, many of the securities were created to absorb a 20 percent decline in value before investors are at risk of losing principal or coupon payments, but the stock has dropped more than that already.
The loss is only real if you decide to sell the bond before it matures, therefore forgoing the future coupon payments that would offset the loss in principal, and lock in that sales price below par.
Visa is using payment information to identify shoppers in a particular mall by their payments on the card and them pushing them a coupon worth 20 percent off at the Gap store in that mall.
Users can also scan their phone to use a coupon, prompting speculation that the service was a placeholder for a future payments product.
Under the original BABs program, the Treasury Department makes direct subsidy payments to State and local governmental issuers in a subsidy amount equal to 35 percent of the coupon interest on the bonds.
Like BABs, AFF Bonds would be conventional taxable bonds issued by State and local governments in which the Federal government makes direct payments to State and local governmental issuers in a subsidy amount equal to 28 percent of the coupon interest on the bonds.
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