Coupon Rates

Question

Coupon Rates

The fixed rate of returns offered by the company for each series of the NCD.

Answer 1 · 2019-05-14

It is the predetermined rate of return offered to the NCD holder. The coupon rate offered by the issuer has an inverse relation with the credit rating. The investors will get a higher interest rate for low credit rated securities and lower interest rate for high credit rated instruments. However, low rated NCDs are riskier than high rated NCDs.

Coupon Rates

Comments

More NCD Terms / Definitions ...