Accretion

What is 'Accretion'

Accretion is asset growth through addition or expansion.

2. In reference to discount bonds, it describes the accumulation of value until maturity.

BREAKING DOWN 'Accretion'

1. Accretion can occur through a company's internal development or by way of mergers and acquisitions.

2. Bonds at discount are sold below face value and mature at par. In the duration between the bond's issuance and maturity, no additional value is actually being accumulated within the bond but accretion occurs with the paper or implied capital gain.

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