Series 52: 5.3.1.5. Bond Points And Basis Points

5.3.1.5.  Bond Points and Basis Points

Bonds are quoted in the market in terms of their price and their yield. The market price for all bonds is quoted as a percentage of the bond’s par value. Percentages are expressed in terms of bond points.

A bond point represents one hundredth, or one percent, of par. Ten bond points is 10% of par; five bond points is 5% of par. Corporate bonds, specifically, are quoted in increments of 1/8. That means that a discount bond quoted at 97 1/8 will have a market value of $1,000 x 0.97125, or $971.25. The market value of a bond quoted at 101