Introduction to Bond Discounts and Premiums
Learn why bonds can be bought for more or less than their original prices, and how this affects how they are taxed.
What you will learn
- Basics of Bond Pricing
- Bond Discounts and Premiums
- Factors Affecting Bond Prices
- Zeros: The Ultimate Discount Bonds
- Special Tax Consequences of Discount and Premium Bonds
What do you know?
Introduction to Bond Discounts and Premiums
You wish to purchase bonds on the secondary market, but you do not know what to make of the different prices that you see. Why do some bonds sell at 95 and others at 110?
As an educated investor, you need to understand what bond premiums and discounts are, why they occur, how to take advantage of them, and how to determine whether they meet your objectives.
