Par Value Definition Finance

Face value the amount of money stated on a bond or rarely a stock certificate.

Par value definition finance. Par value is the stock price stated in a corporation s charter. When a corporation is setup or incorporated a corporate charter is created. A bond selling at par is priced at 100 of face value. Par definition an equality in value or standing.

The par value of a bond also called the face amount or face value is the value written on the front of the bond. For example if a bond certificate says 1 000 the face value is 1000. A company determines the par value per share of stock and prints the amount on each stock certificate. The gains and the losses are on a par.

This is the amount of money that bond issuers promise to be repaid bondholders at a future date. Par can also refer to a bond s original issue. Par most commonly refers to bonds in which. Bonds pay the face value at maturity and calculate coupons as a percentage of the.

Par value definition is par. A level of equality. For instance a company might issue 500 15 year bonds to the public. From this come the expressions at par at the par value over par over par value and under par under par value.

Short for par value par can refer to bonds preferred stock common stock or currencies with different meanings depending on the context. Par value for stock. The intent behind the par value concept was that prospective investors could be assured that an issuing company would not issue shares at a price below the par value. The amount that an issuer agrees to pay at the maturity date.

Par value is important for a bond or fixed income instrument because it determines its maturity value as well as the dollar value of coupon payments. However par value is now usually set at a minimal amount such as 0 01 per share since some state laws still require that a company cannot. What does par value stock mean. How fed s bailout changed.

Par value also called the maturity value or face value. Par value stock is one class of stock issued by a corporation that has a par value set in the corporate charter or articles of incorporation. Par value is the face value of a bond. Par value in finance and accounting means stated value or face value.

You can calculate par value using the information on the balance sheet.