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Maturity

• The date upon which the principal or stated value of an investment becomes due and payable.

• For a bond, the date on which the principal is required to be repaid. In an interest rate swap, the date that the swap stops accruing interest.

• The length of time until the Principal amount of a bond must be repaid.

• Refers to the life of bonds. It is the last payment date.

 
 Embedded terms in definition
 Bond
Interest rate swap
Interest rate
Interest
Payment date
Principal amount
Principal
Stated value
Swap
Time
 
 Referenced Terms
 Accretion of a discount: In portfolio accounting, a straight-line accumulation of capital gains on discount bonds in anticipation of receipt of par at Maturity.In portfolio accounting, a straight-line accumulation of capital gains on discount bond in anticipation of receipt of par at Maturity.

 Accretion of a discount: In portfolio accounting, a straight-line accumulation of capital gains on discount bonds in anticipation of receipt of par at Maturity.In portfolio accounting, a straight-line accumulation of capital gains on discount bond in anticipation of receipt of par at Maturity.

 Accrual bond: A bond on which interest accrues, but is not paid to the investor during the time of accrual. The amount of accrued interest is added to the remaining principal of the bond and is paid at Maturity.

 Advanced refunding: Is the technique of replacing one bond issue by another. This typically occurs when a municipality can borrow at more favorable terms than the outstanding issue. The new issue's proceeds are used to purchase government obligations which are held in escrow. The income and/or appreciation of these government securities is then used to service the outstanding debt. The escrow may be held until the first call date or Maturity of the initial bond issue. If the escrowed funds retire the original issue at the first call date then the issue is pre-refunded. This retirement and replacement process of debt is also known as defeasance.

 Amortize: In portfolio accounting, periodic charges made against interest income on premium bonds in anticipation of receipt of the call price at call or of par value at Maturity. In the context of a loan, amortization means the annuity payments that pay off the loan in full.

 
 Related Terms
 

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