Dual Currency Bond

A debt instrument in which the coupon and principal payments are made in two different currencies. The currency in which the bond is issued, which is called the base currency, will be the currency in which interest payments are made. The principal currency and amount are fixed when the bond is issued.

Dual currency bonds are subject to exchange rate risk. If the currency in which the principal will be repaid appreciates, the bondholder will make money; if it depreciates, he or she will lose money. Investors can use dual currency swaps, which have a fixed exchange rate at issuance, to offset the exchange risk of dual currency bonds.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Dual currency bond — Dual currency bọnd   [ djuəl kʌrənsɪ ; englisch], Doppelwährungsanleihe …   Universal-Lexikon

  • Dual Currency Bond —    A bond that pays a coupon in one currency, but is redeemed for a fixed amount of another currency, often the dollar. Investors usually get an above market coupon, but run the risk that, in this example, the dollar would fall below the exchange …   Financial and business terms

  • dual-currency bond — A bond with the interest paid in one currency and the principal paid in another. Exchange Handbook Glossary …   Financial and business terms

  • dual currency bond — /ˌdju:əl kʌrənsi bɒnd/ noun a bond which is paid for in one currency but which is repayable in another on redemption …   Dictionary of banking and finance

  • dual currency bond — Fin a bond that pays interest in a currency other than the one used to buy it …   The ultimate business dictionary

  • Dual Currency Swap — A currency swap used to hedge the risk associated with the issuance of a dual currency bond. A dual currency swap allows the bond issuer to repay the principal and coupon in the base currency or another currency. Exchange rates are preset in dual …   Investment dictionary

  • Dual Currency Issue — A bond that pays interest in one currency but pays the principal in a different currency. The amount of the principal repayment is set at initiation and paid at maturity. This principal amount usually allows for some appreciation in the exchange… …   Investment dictionary

  • Power reverse dual currency note — A dual currency note (DC) pays coupons in the investors domestic currency with the notional in the issuers’ domestic currency. A reverse dual currency note (RDC) is the reverse. A power reverse dual currency note (PRDN) or power reverse dual… …   Wikipedia

  • Bond duration — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond …   Wikipedia

  • Двухвалютная облигация — еврооблигация, по которой проценты выплачивают в одной валюте по фиксированному курсу, а основная часть в другой валюте. По английски: Dual currency bond Синонимы английские: Dual currency issue См. также: Еврооблигации Финансовый словарь Финам …   Финансовый словарь

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