/

Zero coupon bonds

Zero coupon bonds

What is a zero coupon bond?

A zero coupon bond is a bond that does not make interest payments.

‍

This type of bond is issued at a discount to its maturity value and is redeemed at the maturity value, generating a return for the investor.

‍

UK Treasury bills are an example of a zero coupon bond.

‍

Zero coupon bonds can be issued by governments, municipalities, and companies.

More terms

Value stocks

Stocks in companies that aren’t necessarily growing fast, but instead are dependable and stable.

Rate of Return

Profit on an investment, expressed as a percentage of the investment.

Beta

Learn what Beta stands for in finance.

Investment Trust

A company that pools money together from multiple investors and then invests it.

Money laundering

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

Costs and Charges

The money you pay when investing.

Hedge Fund

Investment funds that are often associated with riskier and shorter-term trading strategies.

W-8BEN Form

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

Margin call

Learn what a margin call stands for in financial terms.

You’re just minutes away from commission-free investing

When you invest, your capital is at risk

Freetrade does not provide investment advice and individual investors should make their own decisions or seek professional advice. The value of investments can go down as well as up and you may receive back less than your original investment. Freetrade is a trading name of Freetrade Limited, which is a member firm of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales (no. 09797821).

© 2025 Freetrade, All rights reserved. The Apple logo is a trademark of Apple Inc. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.