Coupon
A coupon measures the annual rate of interest on a debt instrument such as a bond.
A coupon measures the annual rate of interest on a debt instrument such as a bond. This value is measured from the face value of the bond and does not change as the price of the bond changes. The coupon does not take into account the payment schedule, which often includes one or two payments per year.
Unlike dividends, which get paid to a company’s shareholders and are based on profits, coupon payments are always defined upfront. In the case of a company or central bank defaulting on its debt obligation, coupon obligations may not be fulfilled. The coupon plays a large factor in a bond’s yield, along with the face value and the purchase price.
Coupon is a fundamental financial concept used in investment analysis, portfolio management, and asset valuation. Onramp's glossary covers Coupon as part of a comprehensive educational library that helps Bitcoin investors make informed financial decisions.
Frequently Asked Questions
What is Coupon?
Coupon is a core financial principle used by investors and analysts to evaluate investments, manage risk, and make informed portfolio decisions across all asset classes including Bitcoin.
How does Coupon apply to Bitcoin investing?
Coupon applies to Bitcoin just as it does to traditional investments. As Bitcoin matures as an asset class, institutional tools and frameworks involving Coupon are increasingly applied to Bitcoin portfolios.
Does Onramp help with Bitcoin investment strategies?
Onramp offers Bitcoin IRA accounts, custody solutions, and educational resources that help investors apply financial concepts like Coupon to their Bitcoin allocation strategy.
