DEFINITION of 'Dated Date'

The dated date is the date on which interest begins to accrue on a fixed-income security. Investors who purchase a fixed-income security between interest payment dates must also pay the seller or issuer any interest that has accrued from the dated date to the purchase date, or settlement date, in addition to the face value.

BREAKING DOWN 'Dated Date'

Investors buy bonds issued by corporations, the government, and municipalities in order to receive interest income. Many bonds guarantee a periodic payment of coupon or interest to bondholders until the bond matures. For example, a bond with a par value of $1,000 and 5% coupon rate to be paid semi-annually will pay its investors 5%/2 x $1,000 = $25 every six months. Let’s assume the newly issued bond was sold sometime in January 2018 and its maturity date is February 1, 2023. If interest payments are scheduled for February 1 and August 1 every year until the bond matures, the dated date will be February 1, 2018. An investor will receive his first $25 on the first coupon date, August 1, 2018. The first coupon period, then, is the period from the dated date until the first coupon date.

The dated date is the date when interest starts to accrue on bonds and notes. Within the first coupon period, days from coupon to settlement will always be computed with reference to the dated date. An investor who purchases the bond pays the amount equal to the interest accrued from the dated date to the settlement date and is reimbursed the additional interest when the issuer makes the first interest payment on the security.

If the fixed-income security's date of issuance is the same as the dated date, the dated date is also the issue date. It is also possible that a coupon paying bond is issued after the first accrual date, in which case, the issue date and the dated date will be different. A difference may occur between both dates since issue dates cannot fall on a holiday or weekend. For example, a dated date may be on Saturday, but the issue date will be the following Monday. If the issue date falls after the dated date, the bond will be traded with accrued interest. In effect, the dated date can be on, before, or after the issue date.

The dated date is often used to identify a particular series of bonds of an issuer.

RELATED TERMS
  1. Value Date

    A value date is a future date used in determining the value of ...
  2. Odd Date

    The odd date is seen with some futures contracts for bonds and ...
  3. Trade Date

    A trade date is the month, day and year that an order is executed ...
  4. Date Certain

    Date certain is a term identifying the date on/by which the specified ...
  5. Call Date

    The call date is the date on which a bond can be redeemed before ...
  6. Record Date

    The record date is the cut-off date, established by a company, ...
Related Articles
  1. Investing

    Simple Math for Fixed-Coupon Corporate Bonds

    A guide to help to understand the simple math behind fixed-coupon corporate bonds.
  2. Retirement

    The Unknown Dangers of Target Date Funds

    If they fit within your risk tolerance and have reasonable fees, target date funds can be an option.
  3. Retirement

    An Introduction To Target Date Funds

    Target date mutual funds can be an alternative to bonds and CDs for investors who do not wish to actively manage their savings. The reason: These financial products periodically reallocate fund ...
  4. Investing

    What's Accrued Interest?

    Accrued interest has two meanings. In accounting, it is interest that has been earned, but the time for payment has not yet occurred.
  5. Investing

    Comparing Yield To Maturity And The Coupon Rate

    Investors base investing decisions and strategies on yield to maturity more so than coupon rates.
  6. Investing

    4 basic things to know about bonds

    Learn the basic lingo of bonds to unveil familiar market dynamics and open to the door to becoming a competent bond investor.
  7. Investing

    Why Companies Issue Bonds

    When companies need to raise money, issuing bonds is one way to do it. A bond functions as a loan between an investor and a corporation.
RELATED FAQS
  1. How can I find out the ex-dividend date for a stock's dividend?

    Learn about the various information sources from which investors can obtain information about upcoming ex-dividend dates ... Read Answer >>
  2. What do T+1, T+2 and T+3 mean?

    For security transactions, T+1, T+2, and T+3 refer to settlement dates which occur on a transaction date plus one, two and ... Read Answer >>
  3. When is a bond's coupon rate and yield to maturity the same?

    Find out when a bond's yield to maturity is equal to its coupon rate, and learn about the components of bonds and how they ... Read Answer >>
  4. What is accrued interest, and why do I have to pay it when I buy a bond?

    An investor who sells a bond must be compensated in coupon payments for the period they owned the bond, defined as the interest ... Read Answer >>
Trading Center