Discount: Difference between revisions

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imported>Doug Williamson
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imported>Doug Williamson
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# ''Noun.'' In relation to a discount instrument, the difference between the current market price and the redemption amount.
1.
# A coupon bond trading in the market ''at a discount'' has a market value less than its par value.
 
# A foreign currency trading ''at a discount'' in the forward foreign exchange market is weaker in the forward market than in the spot market.
''Noun.''  
# ''Verb.'' In relation to a money amount, make smaller.  For example, to discount back a future cashflow to a (smaller) present value.
 
# ''Verb.'' In relation to financial instruments, to exchange an instrument with a future maturity date, for a 'discounted' market value today.  Today's market value being smaller than the redemption amount (receivable at maturity) by the amount of the discount.
In relation to a discount instrument, the difference between the current market price and the redemption amount.
 
 
2.
 
A coupon bond trading in the market ''at a discount'' has a market value less than its par value.
 
 
3.
 
A foreign currency trading ''at a discount'' in the forward foreign exchange market is weaker in the forward market than in the spot market.
 
 
4.
 
''Verb.''  
 
In relation to a money amount, make smaller.  For example, to discount back a future cashflow to a (smaller) present value.
 
 
5.
 
''Verb.''  
 
In relation to financial instruments, to exchange an instrument with a future maturity date, for a 'discounted' market value today.  Today's market value being smaller than the redemption amount (receivable at maturity) by the amount of the discount.





Revision as of 14:21, 13 May 2016

1.

Noun.

In relation to a discount instrument, the difference between the current market price and the redemption amount.


2.

A coupon bond trading in the market at a discount has a market value less than its par value.


3.

A foreign currency trading at a discount in the forward foreign exchange market is weaker in the forward market than in the spot market.


4.

Verb.

In relation to a money amount, make smaller. For example, to discount back a future cashflow to a (smaller) present value.


5.

Verb.

In relation to financial instruments, to exchange an instrument with a future maturity date, for a 'discounted' market value today. Today's market value being smaller than the redemption amount (receivable at maturity) by the amount of the discount.


See also