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Coupon

Also called: Coupon rate, coupon percent rate, nominal yield

What is a coupon?

A coupon entitles a bondholder to an interest payment on a bond.

This certificate entitles the holder to an interest payment on a specified date. It usually represents the six-month interest payment on the face value of a bond certificate. For example, a bond with a 10% coupon will pay $10 per $100 of the face value per year, usually in installments paid every six months.

Coupons can be sold individually separate from the bond principal.