- Industry: Financial services
- Number of terms: 73910
- Number of blossaries: 1
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The difference between the face value and the price paid for a security.
Industry:Financial services
The period during which a customer can deduct the discount from the net amount of the bill when making payment.
Industry:Financial services
The interest rate that the Federal Reserve charges a bank to borrow funds when a bank is temporarily short of funds. Collateral is necessary to borrow, and such borrowing is quite limited because the Fed views it as a privilege to be used to meet short-term liquidity needs, and not a device to increase earnings.
Industry:Financial services
Non-interest-bearing money market instruments that are issued at a discount and redeemed at maturity for full face value, e.g., US Treasury bills.
Industry:Financial services
Facility provided by the Fed enabling member banks to borrow reserves against collateral in the form of governments or other acceptable paper.
Industry:Financial services
The yield or annual interest rate on a security sold to an investor at a discount. A bond that is sold at $4875 that matures to $5000 has a discount of $125. To calculate the discount yield: (discount divided by the face value of the security) multiplied by the (number of days in the year divided by the number of days to maturity).
Industry:Financial services
To sell below maturity value, so that the difference makes up all or part of the interest.
Industry:Financial services
The length of time needed to recoup the present value of an investment.
Industry:Financial services
An investment decision rule in which cash flows are discounted at an interest rate and one determines how long it takes for the sum of the discounted cash flows to equal the initial investment.
Industry:Financial services
Calculating the present value of a future amount. Discounting is opposite to compounding.
Industry:Financial services
