Face value
Market basicsAlso called: Par value, Nominal value
The nominal value assigned to a share in the company’s capital accounts, commonly ₹10, ₹5, ₹2 or ₹1 in India.
In plain terms
A bookkeeping figure with no relation to what the share is worth. Dividend percentages are declared against it, which is how a "300% dividend" turns out to be ₹6.
Read the full lesson →Bond
Market basicsA tradeable loan on which the issuer pays a fixed coupon for a defined term and returns the face value at maturity.
In plain terms
Because the coupon is fixed, the price is what has to move to keep the bond competitive with what new borrowers are paying. That seesaw is why debt funds bought for safety can lose money in a rate-hiking cycle.
Read the full lesson →Coupon
Market basicsThe fixed periodic interest a bond pays, expressed as a percentage of its face value.
In plain terms
Not your return. Buy above face value and the premium is a loss spread across the holding period, which yield to maturity captures and the coupon does not.
Read the full lesson →Stock split
Market basicsDivision of a share’s face value, increasing the share count and reducing the price proportionally.
In plain terms
Same as a bonus in effect, different in accounting. Also creates nothing.
Read the full lesson →