Answer :
A bond coupon is a term used to describe an annual interest payment.
Bonds are high-security debt products that make it possible for a company to raise money and fulfill its capital requirements. Debtors borrow this kind of loan from private investors for a predetermined time period.
A coupon payment is an annual interest that is paid on a bond from the date of issuance until the date of maturity. The yield is determined by subtracting the sum of the annual coupons received from the face value of the bond.
The coupon rate, also known as the nominal rate, nominal yield, or coupon payment, of a fixed-income security, is a ratio that expresses the sum that will be paid to the security's owner over the duration of the bond's life. You might decide to buy a $100 10-year bond, for instance, with a 5% coupon rate.
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