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Negative Covenant
What does it mean?
A bond covenant that prevents certain activities, unless agreed to by the bondholders.
In Other Words...
Think of a negative covenant as a promise not to do something. Lenders use negative covenants to protect their investment.
Related Links
Bond Basics Tutorial - What are bonds and do they belong in your portfolio? Get all the answers in this comprehensive tutorial.
Related Terms
Bond | Covenant | Indenture | Negative Pledge Clause
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A | B |
C | D |
E | F |
G | H |
I | J |
K | L |
M | N |
O | P |
Q | R |
S | T |
U | V |
W | X |
Y | Z
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