Chapter 4/Bonds

4. A bond sold for less than par value.
8. A restriction on how soon bonds may be called (Usually 5-10 years after issuance date).
11. Gives an investor the ability to convert the par value of their bond into a set number of shares in a company's common stock. This is not taxable.
12. Implies that as market rates increase, investors will be disinterested in purchasing existing bonds when they get higher yield from buying new bonds.
14. Allows the issuer to redeem outstanding bonds before the maturity date.
15. Par Value of bond divided by conversion price.
16. The amount the issuer agrees to pay the investor at bond maturity.
17. Opposite of a call provision. Gives bondholder the right to redeem the bond on a specified date before maturity.
19. A bond sold for more than par value.

1. The amount of interest that the seller is entitled to get from the buyer and the amount the buyer must pay to the seller for the bond being sold in Secondary market.
2. The rate of return for a bond or the effective return.
3. When issuer is require to par bondholders more than par in order to repay for early redemption of the bond.
5. The rate of interest that is generally fixed at the time of bond issuance and remains the same for the life of the bond. (With some exceptions).
6. Bondholder forced to either convert the bond immediately or accept less than its conversion value.
7. The coupon rate of a bond.
9. Bonds that don't pay periodic interest.
10. If interest rates fall, the value/price rise. If Value/price fall, interest rates rise.
13. Annual Interest divided by the current market price.
15. Recognizing that an issuer may default and might not be able to meet obligations to pay the bondholders.
18. Day the bondholder gets the $1k return from Issuer.