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Can You Pay More Than Nominal Value for a Bond?

Yes, and this is part of what’s called the interest rate risk of bonds.

If someone purchased a $1,000 bond with a 5% coupon, and a year  later, the company issued new $1,000 bonds with a 4% coupon, in order to buy the 5% coupon bond from the owner, you would  obviously need to pay more than $1,000 (since the new bonds issued by the company have a 4% coupon).

What does Nominal Value mean?
What Happens to the Price of a Bond After I Buy It?
Can You Sell a Bond for Less Than the Price You Paid For It?

Keywords: fixed income, interest rate risk, buying and selling activity, bond prices,
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