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Coupon: The annual interest rate paid on a bond, expressed as a percentage of the face value.
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Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a year divided by the face value of the bond in question). It is also referred to as the " coupon rate," "coupon percent rate" and " nominal yield."
A coupon is the annual interest rate paid on a bond, expressed as a percentage of the face value. It is also referred to as the "coupon rate," "coupon percent rate" and "nominal yield.".
The term "coupon" originally refers to actual detachable coupons affixed to bond certificates. Bonds with coupons, known as coupon bonds or bearer bonds, are not registered, meaning that possession of them constitutes ownership. To collect an interest payment, the investor has to present the physical coupon.