Categories: Bonds | Economics and finance stubs The bond market, also known as the debit, credit, or fixed income market, is a financial market where participants buy and sell debt securities usually in the form of bonds. ... This article does not cite any references or sources. ... For alternative meanings, see bond (a disambiguation page). ... In finance, a debenture is a long-term debt instrument used by governments and large companies to obtain funds. ... A government bond is a bond issued by a national government denominated in the countrys own currency. ... A sovereign bond is a bond issued by a national government. ... Agency debt (sometimes referred to in plural as Agencies) is a type of bond issued by a corporation that is nominally independent of the government - though ownership may be public or private - but considered to be backed by the government, usually on a de facto basis. ... In the United States, a municipal bond or muni is a bond issued by a state, city or other local government, or their agencies. ... A corporate bond is a bond issued by a corporation. ... Emerging Market Debt (EMD) is a term used to encompass bonds issued by less developed countries. ... Floating rate notes (FRNs) are bonds that have a variable coupon, equal to a money market reference rate, like LIBOR or federal funds rate, plus a spread. ... Zero coupon bonds are bonds which do not pay periodic coupons, or so-called interest payments. ... Inflation-indexed bonds (also known as linkers) are bonds whose principal are indexed to inflation, cutting out inflation risk. ... Commercial paper is a money market security issued by large banks and corporations. ... An accrual bond is a fixed-interest bond that is issued at its face value and repaid at the end of the maturity period together with the accrued interest. ... An auction rate security (ARS) typically refers to a debt instrument (corporate or municipal bonds) with a long-term nominal maturity for which the interest rate is reset through a dutch auction. ... In finance, a high yield bond (non-investment grade bond, speculative grade bond or junk bond) is a bond that is rated below investment grade at the time of purchase. ... A convertible bond, or convertible debenture, is a type of bond that can be converted into shares of stock in the issuing company, usually at some pre-announced ratio. ... A mortgage-backed security (MBS) is an asset-backed security whose cash flows are backed by the principal and interest payments of a set of mortgage loans. ... An asset-backed security is a type of bond or note that is based on pools of assets, or collateralized by the cash flows from a specified pool of underlying assets. ... A bond option is similar to a stock option with the difference that the underlying asset is a bond. ... // A credit derivative is a financial instrument or derivative (finance) whose price and value derives from the creditworthiness of the obligations of a third party, which is isolated and traded. ... A credit default swap (CDS) is a bilateral contract under which two counterparties agree to isolate and separately trade the credit risk of (at least one) third party entity. ... Collateralized debt obligations (CDOs) are a type of asset-backed security or structured finance product. ... A Collateralized Mortgage Obligation (CMO) is a type of Mortgage Backed Security, which has been divided up into tranches. ... Bond valuation is the process of determining the fair price of a bond. ... Par value has several meanings depending on the context, whether used in the equities market, or in the bond markets, and partially also dependent on where in the world the par value term is used. ... In finance, coupons are attached to bonds, either physically, as with old bonds (with a stapler), or electronically. ... The price quoted for a bond excluding accrued interest. ... Dirty Price A bond price that includes accrued interest. ... In finance, accrued interest is the interest that has accumulated since the principal investment, or since the previous interest payment if there has been one already. ... In finance, a day count convention determines how interest accrues over time for a variety of investments, including bonds, notes, loans, medium-term notes, swaps, and FRAs. ... Nominal yield is the income received from a fixed income security in one year divided by its par value. ... This article or section does not cite its references or sources. ... Yield to maturity (YTM) is the yield promised by the bondholder on the assumption that the bond will be held to maturity, that all coupon and principal payments will be made and coupon payments are reinvested at the bonds promised yield at the same rate as invested. ... The US dollar yield curve as of 9 February 2005. ... In economics and finance, duration is the weighted average maturity of a bonds cash flows or of any series of linked cash flows. ... This article does not cite any references or sources. ... Credit analysis is the method by which one calculates the creditworthiness of a company according to the numbers made available by the audited financials for the financial year. ... Credit risk is the risk of loss due to a debtors non-payment of a loan or other line of credit (either the principal or interest (coupon) or both). ... In finance the Yield spread is the difference between the quoted rates of return on two different investments; a way of comparing any two financial products. ... In finance, a credit spread is the difference in yield between different securities due to different credit quality. ... Option adjusted spread (OAS) is the flat spread over the treasury yield curve required to discount a mortgage-backed securitys volatile coupon payments to match its market price. ... In the context of interest rate derivatives, a short rate model is a mathematical model that describes the future evolution of interest rates by describing the future evolution of the short rate. ... The Rendleman-Bartter model in finance is a short rate model describing the evolution of interest ratess. ... In finance, the Vasicek model is a mathematical model describing the evolution of interest rates. ... In financial mathematics, the Ho-Lee model is a Short rate model of future interest rates. ... In financial mathematics, the Hull-White model is a model of future interest rates. ... The Cox-Ingersoll-Ross model in finance is a mathematical model describing the evolution of interest rates. ... [edit] The model The first stochastic mean and stochastic volatility model was described by Lin Chen in 1996. ... Heath-Jarrow-Morton framework is a general framework to model the evolution of interest rates (forward rates in particular). ... Black-Derman-Toy, or BDT, in finance, is a model of the evolution of the yield curve, sometimes referred to as an short rate model. ...