Strip bonds

Strip Bonds: The capital portion of a bond from which the coupons have been stripped. The holder of the strip bond is entitled to its par value at maturity, but not the annual interest payments.

Strip Bonds: Long term bonds that have had their coupons "stripped" - regular interest payments are sold separate from the bond's par value. Both the coupon (the strip) and the par amount (the residual) are sold at a discount from par.

Strip Bonds or Zero Coupon Bonds
Usually high quality federal or provincial government bonds originally issued in bearer form, where some or all of the interest coupons have been detached.

Strip Bonds or Zero Coupon Bonds Usually high quality federal or government bonds originally issued in bearer form, where some or all of the interest coupons have been detached.

Clip and strip bonds:
These are bonds whose principal and coupon portions may be split and sold separately.
Français: Obligations à coupon détachable
Español: Bonos cortados y separados ...

This is a key strategy for people who buy GICs or strip bonds for RRSPs Instead of trying to guess interest rates, evenly divide your money over a range of terms so part comes due each year. That way you're averaging ups and downs.

When a bond is issued, a brokerage company will buy bonds and will sometimes split them into two parts to sell separately. One part is the interest payment (coupon), and the other part is the maturity value of the bonds, sold as strip bonds.

investments such as treasury bills, Canada Savings Bonds, Government of Canada bonds, provincial government bonds, Crown Corporation bonds, bonds issued by Canadian corporations listed on a prescribed stock exchange, and certain strip bonds ...

See also: Return On Equity, Internal rate of return, Convertible Bond, Investment risk, Reinvestment rate