Discount Bond

Discount bond is a bond trading below its par value.

Why this matters to income investors

A price below par can add return if repaid in full, while also signaling credit concerns.

How to use discount bond in your research

Read the security’s payment terms, seniority, maturity or call rights, and issuer credit condition. Compare the income at your purchase price with the amount you could lose if payments stop or the security is redeemed.

This material is general education and information, not individualized investment, tax, or legal advice.