4.42 Bond Markets:
The debt market is also known as the Bond market. It is a financial market where participants can issue new debt, known as the primary market or buy and sell debt securities, known as the secondary market.
Debt instruments are contracts in which one party lends money to another on pre-determined terms with regard to rate of interest to be paid by the borrower to the lender, the periodicity of- such interest payment, and the repayment of the principal amount borrowed.
4.43 Coupon rate:
Coupon Rate refers to the periodic interest payments that are made by the borrower to the lender and the coupons are stated upfront either directly specifying the rate (e.g.8.50%) or indirectly tying it with a benchmark rate.
4.44 Principal amount:
Principal is the amount that has been borrowed, and is also called the par value or face value of the bond.