Death Bond

Dictionary Says

Definition of 'Death Bond'

A security backed by life insurance which is derived by pooling together a number of transferable life insurance policies. Similar to mortgage-backed securities, the life insurance policies are pooled together and then repackaged into bonds to be sold to investors.
Investopedia Says

Investopedia explains 'Death Bond'

Death bonds provide investors with an unusual instrument that is less affected by standard financial risks. The only risk of holding a death bond lies with the underlying insured person. If the person lives longer than expected, the bond's yield will begin declining. However, because the death bonds are created from an underlying pool of assets, the individual risk associated with one policy is spread out, making the instruments more stable.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. Life Insurance

    A protection ...
  2. Asset-Backed Security - ABS

    A financial ...
  3. Underlying

    1. In ...
  4. Investment Bank - IB

    A financial ...
  5. Agency Bond

    A bond issued by ...
  6. Convertible Arbitrage

    An investing ...
  7. Liquidation

    1. When a ...
  8. Canada Savings Bond - CSB

    A financial ...
  9. Illiquid

    The state of a ...
  10. Secured Note

    A type of loan ...

Articles Of Interest

  1. The Bond Market: A Look Back

    Find out how fixed-income investments evolved in the past century and what it means today.
  2. Making A Living On Death Bonds

    Find out if these macabre bonds are just the new blood your portfolio needs.
  3. How To Avoid Taxation On Life Insurance Proceeds

    Decrease the value of your taxable estate and prevent the tax man from getting you one last time.
  4. Life Insurance: How To Get the Most Out Of Your Policy

    There are many benefits to owning a life insurance policy - if you get the right one for you.
  5. How Bond Market Pricing Works

    Learn the basic rules that govern how bond prices are determined.
  6. This Is Your Brain On Stocks

    Find out how the human mind can hurt investors' portfolios.
  7. Should You Invest Your Entire Portfolio In Stocks?

    It is true that stocks outperform bonds and cash in the long run, but that statistic doesn't tell the whole story.
  8. 5 Tips For Diversifying Your Portfolio

    A diversified portfolio will protect you in a tough market. Get some solid tips here!
  9. 5 Popular Portfolio Types

    Learning how to build these portfolios will increase your investing confidence and give you financial control.
  10. How To Invest When You're Deep In Debt

    Debt is one of the biggest obstacles that prevents people from investing - but it shouldn't be.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center