Authority Bond

DEFINITION of 'Authority Bond'

A debt security issued by an authority, such as a corporate or government agency, for purposes of financing the operations of a revenue-generating public business. Investors in authority bonds have a claim to the business's revenues, which serve as the bond's yield.

BREAKING DOWN 'Authority Bond'

An authority bond is very similar to a municipal bond. Both are issued by an authoritative group, but the projects will typically be of differing natures. Additionally, authority bonds can incorporate margin protections, providing some insurance for the holders.

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RELATED FAQS
  1. What forms of debt security are available for the average investor?

    Discover the various different types of debt securities, issued by government entities or corporations, that are available ... Read Answer >>
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    Learn more about municipal bonds, including the various types of bonds issued and the purposes of municipal bond funds, such ... Read Answer >>
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    The type of bond determines where you can purchase it, so you need to decide which type of bond you would like to purchase ... Read Answer >>
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    Learn about the basics of municipal bonds, including the various revenue sources that are utilized to back or secure municipal ... Read Answer >>
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