4. Terms
This chapter reviews some terms and their protocols as used in the corporate debt markets and in analytics.
Valuation Terms
The following are some common terms used in valuing corporate debt and brief descriptions of how they are used.
Prices on corporate bonds are quoted as a percentage of face amounts. A typical bond is $1,000 or €1,000 face amount (or par). Even though in practice, prices often appear with a dollar sign or a euro sign in front of the price, this is incorrect and it is actually a percentage of par. Bonds typically have a minimum size of $1,000. So a price of $91 actually means 91% of $1,000. A round lot trade is usually considered to be $1,000,000 face amount (or one million in whichever currency the bond is issued ...
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