Zero-Coupon Indexed Bond

Finance
NFT
March 9, 2021
Finance
ZC Indexed Bond
March 9, 2021

An index linked bond that pays no coupon (hence, the zero coupon), whilst repayment of its principal is linked to inflation (an inflation index). The holder of this bond is entitled to receive one nominal unit adjusted to inflation before maturity.

In which case, the principal is only inflation-linked, while interest is zero.

This kind of bonds was introduced in Sweden.

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