Deep Discount Bonds

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August 21, 2017 at 8:01 pm #402826
mjibola
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Are deep discount bonds very different from the conventional bonds you explained? Are their computations also different?
August 22, 2017 at 9:16 am #402900
John Moffat
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They are exactly the same as all bonds and so are the calculations.

They are issued at a big discount to the nominal value and so offer lower interest (because the investor makes a big gain on redemption).
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