premium bond

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Premium bond

A bond that is selling for more than its par value.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Premium Bond

A bond with a price higher than its face value. A premium bond occurs when a particular bond's coupon rates exceed the interest rates prevailing at the time. For example, if a bond was issued with a 5% coupon and most other bonds are paying 2%, this bond has more value on both the primary and secondary markets. As a result, it is more expensive and is sold at a premium.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

premium bond

A bond that sells at a price above its par value. An investor must be careful about purchasing a bond that is selling at a premium because of the possibility of a call by the bond's issuer for sinking fund requirements or for refunding. Except for convertible bonds, the size of a bond's premium usually can be expected to decline as the bond approaches maturity, at which time it will be paid off at par.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

premium bond

a FINANCIAL SECURITY issued by the UK government as a means of raising money for the government and encouraging private SAVING. Premium bonds are issued in small denominations, but do not pay interest, nor can a capital gain be obtained on redemption, since they are issued and redeemed at their face value. Their appeal lies in the prospect of a ‘gambler's chance' of winning a substantial lump sum of money in a monthly prize lottery (numbers being drawn electronically by ‘ERNIE’).
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

premium bond

a FINANCIAL SECURITY issued by the UK government as a means of raising money for the government and encouraging private SAVING. Premium bonds are issued in small denominations but do not pay interest, nor can a capital gain be obtained on redemption since they are issued and redeemed at their face value. Their appeal lies in the prospect of a ‘gambler's chance’ of winning a substantial lump sum of money in a monthly prize lottery (numbers being drawn electronically by ‘ERNIE’).
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
TECHNOLOGY: ERNIE (Electronic Random Number Indicator Equipment) started off in 1957 as an unwieldy 7ft x 18ft machine.
No, I refer to the Electronic Random Number Indicator Equipment (aka the Premium Bond computer), whose name used to be in everyday use, but which I haven't heard talked about for several years.
ERNIE, the Electronic Random Number Indicator Equipment, celebrated its 40th birthday by breaking four big records - the amount of prize money, annual sales, monthly sales and the amount invested.
Ernie - Electronic Random Number Indicator Equipment - will still select the winning numbers.
ERNIE - the Electronic Random Number Indicator Equipment which picks the winning numbers - has paid out more than 57 million prizes worth pounds 3.5 billion since he was set up in 1957.
Ernie, the Electronic Random Number Indicator Equipment that selects Bond holders at random for a cash award, is a lucky Gemini.
A growing number of people hit by both the lowest interest rates for five decades and an uncertain stock market,arefollowing in Carol's footsteps and putting their faith in Blackpool-basedErnie ( electronic random number indicator equipment), who has been picking the winning Premium Bond numbers every month for nearly 47 years.

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