Overview

junk bond


Show Summary Details

Quick Reference

Bonds issued on very doubtful security. The finances of the firm issuing them are regarded as so insecure that there is serious doubt as to whether the interest and redemption payments promised will actually be made. Junk bonds are thus risky to hold, and lenders will hold them only if the promised returns are high enough to give an acceptable expected rate of return, after allowing for a non-negligible probability of default.

Subjects: Economics.


Reference entries

See all related reference entries in Oxford Index »


Users without a subscription are not able to see the full content. Please, subscribe or login to access all content.