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Original Issue Discount - OID
What does it mean?
The discount from par value at the time a bond or other debt instrument is issued. It is the difference between the stated redemption price at maturity and the issue price.
In Other Words...
An original issue discount bond is a bond issued at a price below par. The most extreme example of an OID is a zero coupon bond. OID is considered to be a form of interest, so tax issues can get a bit complicated.
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 | Par Value | Zero-coupon Bond
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A | B |
C | D |
E | F |
G | H |
I | J |
K | L |
M | N |
O | P |
Q | R |
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Y | Z
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