Series 53: Odd First Coupon

Odd First Coupon

Recall that the dated date is the date when interest begins to accrue on a newly issued bond. The dated date may or may not be the actual date of issuance. If the two dates do not coincide, the first coupon payment will not reflect an exact six-month accrual period. Known as an odd first coupon, the accrual period may be short or long. A short first coupon is made by the issuer when the first accrual period is shorter than the traditional six-month period. This occurs when the dated date is after the date that the bonds are delivered to the underwriter. A long first coupon is made by the issuer when the first accrual period is longer than the traditional six-month period. This occurs when the dated date is before the date that the bonds are deliver