Basis Price

Basis price

Price expressed in terms of yield to maturity or annual rate of return.

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Basis Price

A quote for a bond expressed in terms of the bond's yield to maturity. For example, if the yield to maturity is 8%, the basis price is also 8%.

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basis price

1. The price of a security quoted in terms of its yield rather than its dollar price. Bonds are often quoted on a basis price reflecting yield to maturity since such information is of greatest importance to an investor deciding to buy or sell.

2. The price selected by a specialist at which to execute an odd-lot order on an inactive stock. The large spread on inactive stocks often results in a basis price that splits the difference between the bid and ask.

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Basis price. When you sell a security, such as a stock or bond, or real estate, the price you use to calculate your capital gains is known as your basis price.

In the case of a security, it includes the purchase price plus any commissions you paid to buy or sell. For real estate, it includes purchase price, certain closing costs at purchase and sale, and the costs of qualifying improvements to the property.