Investment & trading encyclopedia

Understand investment products, market mechanics, indicators and research terminology. Each entry includes an explanation, example, cautions and related learning.

80 explained termsView all courses

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Bonds & ratesBeginner

Coupon

A coupon is the periodic interest payment a bond issuer makes to bondholders, normally stated as an annual percentage of face value called the coupon rate.

Bonds & ratesIntermediate

Credit Spread

A credit spread is the extra yield a bond pays over a comparable-maturity benchmark, such as a government bond, to compensate investors for credit, liquidity and other risks. It is usually quoted in basis points, where 100 basis points equal one percentage point.