In
finance, in particular with reference to
bonds and
swaps, a stub period is a length of time over which
interest
In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is disti ...
accrues are not equal to the usual interval between
bond coupons.
These periods normally occur because the interval between coupons does not fit neatly into the period for which the bond was issued, thus sometimes a bond's final or first coupon period may be adjusted to make the bond start and mature on the desired dates.
References
External links
Interest Calculations and the Impact of Stub Periods
Bonds (finance)
Bond valuation
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