Bear Bond

Bear Bond

A bond that is likely to increase in price when stocks or the economy at large is performing poorly (that is, when interest rates are rising). Interest-only bonds and mortgage-backed securities that pay only interest are common examples of bear bonds because, in a bear market, people tend to pay only interest on large debts. See also: Flight to Safety.
References in periodicals archive ?
American Independence Absolute Return Bull Bear Bond Fund Class I - (TBBIX)
Unsurprisingly, boy and bear bond in the wilderness.
During the recent bear bond market, this portion of the fund included collateralized mortgage obligation derivatives and other mortgage-backed securities.
As a result of losses realized during the recent bear bond market, the non-zero-coupon bond portion of the portfolio is now too small to generate the cash needed to make those payments for the six years remaining until maturity.
The interest rate on both the bull bonds and the bear bonds converts to a fixed rate following a prespecified conversion date, typically the first call date.
After the conversion date, both the bull bonds and bear bonds will pay |X~.