What are Zero-Coupon Bonds? (Definition, Formula, Example, Advantages, and Disadvantages)
What are Zero-Coupon Bonds? A zero-coupon bond is a financial instrument that does not render interest. They normally trade at high discounts, and offer full face par value, at the time of maturity. The spread between the purchase price of the bond and the price that the bondholder receives at maturity is described as the …