Bond premium

Bond premium

Risk Premium

The return over and above the risk free rate of return that an investor expects in exchange for each additional unit of risk. According to Markowitz portfolio theory, rational investors only accept additional risk if they expect a greater return. One refers to this greater return as the risk premium. See also: Risk capital, Eat well, Sleep well.
References in periodicals archive ?
If the endowment growth process truly follows a random walk, then long-bond returns do not necessarily fall during recessions and hence the standard model might fail to generate even a positive bond premium. In this subsection, we demonstrate this point analytically in the representative agent economy.
The index is based on the long-term, upward trend of global economic growth measuring real-world value using financial indicators such as the GDP of more than 190 countries, FX indicators of a basket of 16 currencies, and sovereign bond premium yields.
(3) Using a flexible empirical framework, we then decompose this credit spread into two parts: a component reflecting the available firm-specific information on default risk and the excess bond premium (EBP), a residual component that can be thought of as capturing investor attitudes toward corporate credit risk--that is, credit market sentiment.
ADEQUATE LIQUIDITY: Lenbrook had $34.9 million in unrestricted cash and investments in fiscal 2018, which translates into 452 days cash on hand (DCOH), 42% cash to debt (excluding bond premium), and 6x cushion ratio and remains light but sufficient to support its current rating level given its solid operations and strong IL demand indicators.
Furthermore, we find that even if several other influencing factors are already present in the model, the CAT bond premium increases if the rating declines.
Gilchrist and Zakrajsek call this measure of sentiment the excess bond premium (EBP).
One of the challenges facing CPAs is how to handle bond premium amortization in light of the new favored New York State tax treatment.
A contractor will be required to pay only a percentage of it, which is called the bond premium. Contractors with good credit scores and sound finances will likely pay between 1 percent and 3 percent of the bond amount.
The IRS issued final and temporary regulations providing rules for brokers to report bond premium and acquisition premium as well as governing information reporting of transactions involving debt instruments and options.
"The trial justice granted recovery as to two invoices in his written decision: the increase on the bond premium ($12,929.40) and the replacement of the damaged wet pipe ($72,857.96).
Issued at par, with no OID, and purchased with bond premium;
Bond premium is a commission which is not based on loss experience or statistics.