What is a zero-coupon bond?Bond with no face valueBond with no coupon paymentsBond with no credit riskBond with no maturity date

A zero-coupon bond is a type of bond that does not have a face value. This means that the bond does not have a specified amount that will be repaid to the bondholder at maturity. Instead, the bond is typically sold at a discount to its face value, and the bondholder will receive the full face value of the bond at maturity.

Additionally, a zero-coupon bond does not make any coupon payments to the bondholder. Coupon payments are periodic interest payments that are made to bondholders throughout the life of the bond. Since a zero-coupon bond does not make these payments, it is also known as a discount bond.

Furthermore, a zero-coupon bond does not have any credit risk. This means that the bondholder does not face the risk of the issuer defaulting on the bond payments. This is because the bondholder only receives a single payment at maturity, and the issuer is obligated to make this payment.

Lastly, a zero-coupon bond does not have a specified maturity date. Instead, the bondholder holds the bond until maturity, at which point they receive the full face value of the bond. The length of time until maturity can vary depending on the specific terms of the bond.

In summary, a zero-coupon bond is a bond without a face value, coupon payments, credit risk, or a specified maturity date.