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Term Premium

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Term Premium
The amount by which the yield-to-maturity of a long-term bond exceeds that of a short-term bond. Because one collects coupons on a long-term bond for a longer period of time, its yield-to-maturity will be more. The amount of a term premium depends on the interest rates of the individual bonds.


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It will now have an additional 2 million tons of naphtha a year but its high term premiums set for July 2010-June 2011 at $22.
It will now have an additional 2 million tonnes of naphtha a year but its high term premiums set for July 2010-June 2011 at $22.
Expensive funding and a rising term premium will stunt growth and they will impose a haircut on risk asset prices.
 
 
 
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