Bonds At A Discount — Buying

By buying at $650, Arthur had unlocked a double-sided gold mine:

On the day of , Arthur walked into the same diner. He hadn't just collected high interest for five years; he also cashed in on that $350-per-bond capital gain. He bought the whole room a round of coffee and pie, smiling as he explained that in the world of bonds, sometimes the best treasures are found in the "damaged goods" section. buying bonds at a discount

AI responses may include mistakes. For financial advice, consult a professional. Learn more By buying at $650, Arthur had unlocked a

Arthur wasn’t a gambler, but he loved a good fire sale. While everyone else was chasing the booming tech stocks of the early 90s, Arthur was digging through the wreckage of a massive regional utility company that had suffered a catastrophic (but ultimately fixable) technical failure. Its corporate bonds, originally issued at a of $1,000, had plummeted to $650 . AI responses may include mistakes

Bonds have a legal obligation to pay back the full $1,000 at the end of their term. Arthur was essentially buying a future $1,000 for a $350 discount.