The Basics

What is a “coupon payment”?

When a bond issuer pays the bond buyer interest periodically on a bond investment during its term, it is called a coupon payment. For example, the issuer of a $10,000 bond paying 8% would send a coupon payment of $400 twice a year to the bond investor. When the bond matures, in addition to these semi-annual payments, the bond investor will receive the full face value of the bond.


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