CREDIT RATINGS
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a.This requirement is for students to assign in their give words several technical terms. It is not possible to state a solution that reflects exactly what students will say, but followers are basic ideas that should be included in their definitions:
transformable attachments
?Gives the investor the right to convert its bond into stock of the company.
?You will motivation to know how many shares of stock you can get for severally bond.
?The mo of shares you can receive, as well as their price, is preset at the bonds issue and remains fixed throughout the life history of the bond.
?The number of shares you can receive is referred to as the bonds conversion
station.
?The number of shares you can exchange a bond for, multiplied by the stocks current market value, is equal to the amount of the bonds conversion value.
dust bonds
? throw away bonds are low-grade bonds issued by companies without long leading records or within questionable ability to meet their debt obligations.
?Junk bonds typically pay very high interest grade and are sometimes referred to as high-yield bonds.
?Because junk bonds have a high default risk, they are speculative.
Zero coupon bonds securities
?With tralatitious bonds, the coupon rate is the rate of annual interest the issuer pays to the bondholder.
?In a zero coupon bond, the stated rate is zero, centre that the bonds do not pay annual interest.
?Because the coupon rate is zero, these bonds typically sell at deep discounts.
?The investor gets his/her return when the bond matures or sells at a price in inordinateness of the purchase price....If you want to get a full essay, grade it on our website: Orderessay
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