Skip to content

When a dealer strips a Treasury bond and sells the strips in the bond market, what is the coupon on each stripped bond?

July 19, 2012

0%

Each Treasury strip is a zero-coupon instrument. Its yield is determined by the market through active trading.

Advertisements

From → Asset Valuation

3 Comments
  1. justinsarafin@gmail.com permalink

    An acronym for ‘separate trading of registered interest and principal securities’. Treasury STRIPS are fixed-income securities sold at a significant discount to face value and offer no interest payments because they mature at par.

Trackbacks & Pingbacks

  1. CFA Level 1 Study Advice – Muskblog

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: