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junk bond

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junk bond

–noun Finance.
any corporate bond with a low rating and a high yield, often involving high risk.

Origin:
1975–80
Dictionary.com Unabridged
Based on the Random House Dictionary, © Random House, Inc. 2009.
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junk bond  
n.  A corporate bond having a high yield and high risk.
The American Heritage® Dictionary of the English Language, Fourth Edition
Copyright © 2009 by Houghton Mifflin Company.
Published by Houghton Mifflin Company. All rights reserved.
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Slang Dictionary
junk bond

  1. n.
    a low-rated corporate bond that pays higher interest because of greater risk. (Parallel to junk food.) : Don't put all your money into junk bonds.
Dictionary of American Slang and Colloquial Expressions by Richard A. Spears.Fourth Edition.
Copyright 2007. Published by McGraw Hill.
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Financial Dictionary

Junk Bond

A bond rated BB or lower because of its high default risk. Also known as a high-yield bond, or speculative bond.

Investopedia Commentary

These are usually purchased for speculative purposes. Junk bonds typically offer interest rates three to four percentage points higher than safer government issues.

Related Links

Junk Bonds: Everything You Need to Know
Corporate Bonds: An Introduction To Credit Risk
Bond Basics Tutorial

See also: Bond, Bond Rating, Default Risk, Stub, Vulture Fund

Investopedia.com. Copyright © 1999-2005 - All rights reserved. Owned and Operated by Investopedia Inc.
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Financial Dictionary

junk bond

A high-risk, high-yield debt security that, if rated at all, is graded less than BBB by Standard & Poor's or BBB3 by Moody's. These securities are most appropriate for risk-oriented investors. Also called high-yield bond.

Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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Legal Dictionary

Main Entry: junk bond
see BOND 2
Merriam-Webster's Dictionary of Law, © 1996 Merriam-Webster, Inc.
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