A deep discount bond is a debt security that sells for a substantial amount below its face value, often at a discount of more than 25%. Unlike original issue discount bonds, these bonds were initially issued at their par value but have since declined in market value.
A loan stock or government security issued on terms that make the redemption value significantly higher than the issue price, often with more than 15% discrepancy or ½% per completed year.
A zero coupon bond is issued at a discount and matures at its face value, paying no interest during its life. It is a deep discount bond and offers a unique investment opportunity.
