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zero coupon bond
noun
(finance)
A
bond
(e.g.,
corporate
debenture
or
government
debt)
that
has
no
coupon
(i.e.,
pays
no
interest),
during
the
life
of
the
issue.
Such
a
bond
is
initially
sold
at
a
discount
to
its
face
value.
The
rate
of
return
to
the
holder
is
derived
from
the
gradual
appreciation
as
the
security
moves
toward
maturity.
zero-coupon note
noun