© 2016 Shmoop University, Inc. All rights reserved.

Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Premium Bond

Definition:

To us, Daniel Craig. That was one prime 007.

Oh... you mean financial stuff. Right.

A prime bond is a bond that trades for a higher price than its par value. It can happen if the bond had a higher coupon or interest rate when compared with other bonds being sold. Investors are willing to pay more because the bond can make them more.