Agio

AAA

DEFINITION of 'Agio'

A description of the bond premium when the bond market value is greater than the par value. In international markets, agio can also sometimes refer to the fee paid for undertaking a transaction. Because these bonds are often traded on international markets, the agio premium is also used to describe the premium to exchange currencies.

INVESTOPEDIA EXPLAINS 'Agio'

As an example, if a bond was issued at 105%, then its agio would be 5%. Agio is typically an uncommon term for spread, and is not commonly used in Canada or the U.S.

RELATED TERMS
  1. Exchange Rate

    The price of a nation’s currency in terms of another currency. ...
  2. Unamortized Bond Premium

    The difference between the par-value or face-value of a bond ...
  3. Call Warrant

    A financial instrument that gives the holder the right to buy ...
  4. Warrant

    A derivative security that gives the holder the right to purchase ...
  5. International Bond

    Debt investments that are issued in a country by a non-domestic ...
  6. Bond

    A debt investment in which an investor loans money to an entity ...
Related Articles
  1. Junk Bonds: Everything You Need To Know
    Bonds & Fixed Income

    Junk Bonds: Everything You Need To Know

  2. Corporate Bonds: An Introduction To ...
    Bonds & Fixed Income

    Corporate Bonds: An Introduction To ...

  3. The Basics Of Municipal Bonds
    Bonds & Fixed Income

    The Basics Of Municipal Bonds

  4. The Advantages Of Bond Swapping
    Bonds & Fixed Income

    The Advantages Of Bond Swapping

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center