Investopedia

Continue to Site »

Semi-Annual Bond Basis - SABB

Filed Under » ,
Dictionary Says

Definition of 'Semi-Annual Bond Basis - SABB'

A conversion metric to compare rates on bonds with varying characteristics. Since bonds come with all types of coupon rates and payment frequencies, it's important to be able to find some common measure to compare different types of bonds side-by-side. By using a semi-annual bond basis (SABB), the interest rate of a bond that pays other than semi-annually is converted into its semi-annual equivalent.
Investopedia Says

Investopedia explains 'Semi-Annual Bond Basis - SABB'

When considering the purchase of a bond from a brokerage, be sure to ask for the interest rate to be quoted on a semi-annual bond basis. If they are unable to provide this computation for you and you plan on investing in bonds on a regular basis, you should consider investing in a financial calculator or computer program that can assist you in this calculation.

Articles Of Interest

  1.

    The Advantages Of Bonds

    Bonds contribute an element of stability to almost any portfolio and offer a safe and conservative investment.

  2. Corporate Bonds: An Introduction To Credit Risk

    Corporate bonds offer higher yields, but it's important to evaluate the extra risk involved before you buy.

  3. How Bond Market Pricing Works

    Learn the basic rules that govern how bond prices are determined.

  4. Top 6 Uses For Bonds

    We break down the stodgy stereotype to see what these investments can do for you.

  5. Junk Bonds: Everything You Need To Know

    Don't be fooled by the name - junk bonds may be for you if you know how to analyze them.

  6. Event-Linked Bonds: Competing Against A Catastrophe

    These debt instruments can blow new wind into your portfolio, but only if you can handle the risk.

  7. Advanced Bond Concepts

    Learn the complex concepts and calculations for trading bonds including bond pricing, yield, term structure of interest rates and duration.

  8. Bond Basics Tutorial

    Investing in bonds - What are they, and do they belong in your portfolio?

  9. Zero-Coupon Bond

    A zero-coupon bond or ‘no coupon’ bond is one that does not disburse regular interest payments. Instead, the investor buys the bond at a steep discount price; that is, at a price ...

  10. Why Your Pension Plan Has Sovereign Debt In It

    One type of security pensions tend to invest in is sovereign debt, or debt issued by a government.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Validation Period

    The amount of time necessary for the premium on an insurance policy to cover the commissions, the cost of investigation, medical exams and other expenses associated with the issuance of the policy.

  2. Winner's Curse

    Because of incomplete information, emotions or any other number of factors regarding the item being auctioned, bidders can have a difficult time determining the item's intrinsic value. As a result, the largest overestimation of an item's value ends up winning the auction.

  3. Glocalization

    A combination of the words "globalization" and "localization" used to describe a product or service that is developed and distributed globally, but is also fashioned to accommodate the user or consumer in a local market.

  4. Disaster Loss

    A special type of tax-deductible loss, similar to a casualty loss, where a loss has been incurred by taxpayers who reside in an area that has been designated as a federal disaster area by the President.

  5. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.

  6. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.
Trading Center