Business/Finance

Bond is a debt security. It is one kind of agreement between the borrower and the lender. The lender borrows the amount of money and it is called the principal amount. In bond, the borrower accepts to pay the fixed amount of interests during particular period of time. It is called the coupons. Bond valuation is the calculation of the actual of price of a bond. The actual value of the bond is the current value. It includes future interest payments. It is also known as cash flow. The maturity bond value is known as the par value or face value. Bonds and shares are called as financial assets. There are many concepts included in the bond valuation. It is used for various purposes. The value of the bond is based on the market rate. The bond valuation varies. The value of the bond and the interest rate is connected with inverse relationship.