Bond price coupon rate relationship
In fact they thrive on moving in opposite directions. Whatever the prevailing interest rate happens to be at the time, that rate will set the value of the coupons. Naturally any drop in value of your own bond would depend on its price and the prevailing interest rate—both at the start of the term and after any rate increase. When it comes to bond funds and interest rates, there will always be ups and downs. However, before you make any final decisions, be sure to speak with an Educators financial specialist.
Having provided financial guidance exclusively to members of the education community for over 40 years, we can help to ensure your investment portfolio is still on track towards meeting your overall goals—no matter where you are in your career, or what your pension income is in retirement.
What is Coupon Rate? Definition of Coupon Rate, Coupon Rate Meaning - The Economic Times
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