The yearly interest a bond pays, as a share of face value
The coupon rate is the interest paid each year as a percentage of face value. It is fixed when the bond is issued and, for most bonds, stays the same until maturity. Because you may pay more or less than face value, your actual return, the yield, differs from the coupon rate. Bonds issued while rates are high carry higher coupons.
A bond with a face value of $10,000 and a 2% coupon pays $200 of interest a year.
For learning, not investment advice. Decisions are your own.
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