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Accretion – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Accretion?Accretion is slow growth through gradual accumulation. In business, accretion occurs when profits are a direct result of a gain in assets or business growth. In investing, investors expect to see capital gains accumulate on investment. This is also...

Bearer Bond – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Bearer Bond?A bearer bond is defined as fixed-income security that is owned by the holder instead of a registered owner. The bondholder has a responsibility of submitting the coupon interest payments, which are physically attached to the bond, to a bank for...

Bond Ratings – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is a Bond Rating?This is a rating that is given to a bond to show its credit quality. These ratings are provided by private independent rating services based on the financial strength of a bond issuer. These ratings are expressed as letters which range from the...

Amortization of Bond Costs – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Amortization of Bond Costs?Amortization of bond costs is a process of adjusting the nominal interest expense of a bond to the actual interest expense.How Does Amortization of Bond Costs Work?There are only two methods amortizing bond costs:Straight-line bond...

Amortization of Bond Discount – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is Amortization of Bond Discount?Amortization is a process carried out to reduce the cost base of a bond for each period to reflect the economic reality of the bonds approaching maturity. The amortization is done at par. It is easy to prepare, and it is essential...

At The Money Option Price – Explained

by TheBusinessProfessor | Feb 23, 2025 | Investments, Trading, and Financial Markets

What is At The Money (Options Price)?At The Money Option Price refers to a situation where the strike price of an option is the same as that of the underlying security. If, for example, the stock of XYZ is trading at $75, then the call option of XYZ 75 is at the money...
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