What is 'maturity value'? Definition & meaning

What's the maturity value of a bond?

The maturity value of a bond is the amount of money that an investor will be repaid when a bond’s term ends.

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The maturity value may also be called a bond’s face value, the principal, or par.

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This value is typically reflective of the amount of money that has been borrowed by the issuer of the bond, excluding interest payments.

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In the case of a zero coupon bond, the maturity value represents both the original amount borrowed, plus an additional sum that represents the return on the bond that the borrower receives in return for the loan.

More terms

Running yield

The annual interest payment (dividend) divided by the current market price of a bond.

Accrued interest

The interest earned on a gilt since the last dividend date. When buying a gilt, the buyer pays the accrued interest at the time of a transaction to the seller in addition to the clean price of the gilt

Yield

Income from an investment as a percentage of its current price.

Free Trade

The other free trade. International trade in which countries allow goods to flow across their borders without imposing import or export taxes.

Total Return

This is the measurement of a fund’s performance in a specific period.

Investment Return

The amount of money made or lost from an investment. Usually expressed as a percentage.

W-8BEN Form

Non-US individuals and businesses may have to file this form for the Internal Revenue Service (IRS), the US tax authority.

Money laundering

A method of moving money obtained illicitly through the financial system so it can be used legally.

Zero coupon bonds

What is a zero coupon bond?

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Maturity value