Discount Note

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Discount Note

A debt security with a maturity of one year or less issued at a discount to its face value. For example, if a discount note has a face value of $1,000, it may be issued to the holder at $900. When it matures, the holder receives the full $1,000. A discount note does not pay a coupon; rather, the difference between the discount and the face value takes the place of the coupon. See also: coupon-equivalent yield.
References in periodicals archive ?
recently completed an offering of its senior discount notes due 2011, with a value at maturity of $135 million and yielding gross proceeds of $73.
Uniroyal Chemical also announced that it has completed the repurchase of $182 million of its 12% subordinated discount notes due 2005, 11% senior subordinated discount notes due 2003 and 10-1/2% senior notes due 2002.