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Repayment of a debt security or preferred stock issue, at or before maturity, at par or at a premium price.


1. In bonds, the act of an issuer repurchasing a bond at or before maturity. Redemption is made at the face value of the bond unless it occurs before maturity, in which case the bond is bought back at a premium to compensate for lost interest. The issuer has the right to redeem the bond at any time, although the earlier the redemption take place, the higher the premium usually is. This provides an incentive for companies to do this as rarely as possible.

2. The act of the issuing company repurchasing stocks or mutual funds. In the case of mutual funds, the repurchase is made at net asset value per share. Stocks may be redeemed in cash or by proration. See also: Proratable factor.


The retirement of a security by repurchase. Although generally used in reference to the repurchase of a bond before maturity, the term also applies to stock and mutual fund shares. See also partial redemption.


When a fixed-income investment matures, and you get your investment amount back, the repayment is known as redemption.

Bonds are usually redeemed at par, or face value, traditionally $1,000 per bond. However, if a bond issuer calls the bond, or pays it off before maturity, you may be paid a premium, or a certain dollar amount over par, to compensate you for lost interest.

You can redeem, or liquidate, open-end mutual fund shares at any time. The fund buys them back at their net asset value (NAV), which is the dollar value of one share in the fund.

References in periodicals archive ?
Just like Sachs's refutation of the redemptory terms offered by the book of Job, the reversal of the sacrificial, redemptive message of this Biblical story is similarly significant in terms of refuting any kind of religious "sense-making" interpretation of the Holocaust.
However, in this authoritarian system, the literary word also attained godly if not redemptory dimensions, since it embodied a deliberate resistance to the communist state.
Moreover, what further distinguishes these artists from their parents' generation is their categorical rejection of art's traditional redemptory function in the face of catastrophe.
To rise to the occasion, Arafat had to cater to the predominant mood of excitement and hope by injecting into his speeches in practically all those cities the same redemptory themes: liberty, independence, Jerusalem as the capital, the continuation of jihad, struggle to victory.
and his death can be regarded as a token of God's love for all mankind in the same sense as Christ's redemptory death.