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User berhanyxgz
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Most bonds can be offered by the preliminary bondholder to other financiers after they have actually been provided. Simply put, a bond financier does not have to hold a bond all the method through to its maturity date. It is also common for bonds to be redeemed by the customer if interest rates decrease, or if the debtor's credit has improved, and it can reissue brand-new bonds at a lower cost.
For example, say an investor purchases a bond at a premium $1,090 and another financier buys the exact same bond later on when it is trading at a discount for $980. When the bond matures, both financiers will get the $1,000 face value of the bond. is the rate of interest the bond company will pay on the face worth of the bond, expressed as a percentage.
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