Browse Investing

Bond Valuation and Accrual

Bond valuation terms for pricing, accrual, amortization, equilibrium value, and return recognition.

Bond valuation and accrual terms explain how market price, present value, accrued interest, amortization, and carrying value are measured over time.

Use this branch when the question is not only what a bond yields, but how its price or income is recognized between coupon dates and reporting periods.

Key Terms in This Branch

TermWhat it clarifies
Bond ValuationEstimating a bond’s value from cash flows, discount rates, credit risk, and market inputs.
Accrual BondA bond where interest accrues rather than being paid currently under the stated structure.
Amortized BondA bond with principal, premium, or discount recognized over time under an amortization method.
Bond EquilibriumA concept linking bond price with required return and market balance.

What to Verify

Check cash-flow dates, coupon frequency, settlement date, accrued-interest convention, discount rate, credit spread, price source, amortization method, and whether the value is for trading, accounting, tax, or portfolio analysis.

Common Mistakes

  • Mixing clean price, dirty price, and carrying value.
  • Treating model valuation as an executable trade price.
  • Ignoring accrued interest in settlement calculations.
  • Applying accounting amortization logic to market-return analysis without explaining the purpose.

In this section

Choose a subsection first. Deeper term pages live inside each subsection, which keeps large topic hubs readable.

Accrual Bond

An accrual bond is a type of bond where interest accrues over time instead of being paid out periodically, typically seen in zero-coupon bonds (also known as Z-Bonds).

Amortized Bond

An amortized bond spreads premium or discount over time so carrying value and interest income reflect the effective yield.

Bond Equilibrium

Bond equilibrium is the price-yield level where investor demand and issuer supply balance in the bond market.

Bond Valuation

Bond valuation estimates a bond's fair price by discounting coupon and principal cash flows at an appropriate yield.

Revised on Sunday, June 21, 2026