Equipment Trust Certificate

equipment trust certificates investment & finance definition
A type of corporate bond that is issued by railroads (the largest issuer), airlines, or other transportation firms.

Equipment Trust Certificate
A type of security, generally issued by a railroad, to pay for new equipment. Title to the equipment, such as a locomotive, is held by a trustee until the notes are paid off.

Equipment Trust Certificate
A debt instrument that allows a company to take possession of an asset and pay for it over time.

Equipment trust certificates
Railroads and airlines have issued this type of bond as a way to pay for new equipment at relatively low interest rates.

Equipment trust certificates: A corporate bond offering secured by the equipment of a railroad, airline, or trucking firm, known as rolling stock.
Equity: The value of an asset (or part of an asset) which is not indebted.

Equipment trust certificates
Certificates issued by a trust that is formed to purchase an asset and lease it to a lessee. When the last of the certificates has been repaid, title and ownership of the asset transfers to the lessee.

Conditional sales contracts
Similar to equipment trust certificates, except that the lender is either the equipment manufacturer or a bank or finance company to which the manufacturer has sold the conditional sales contract.

Municipal Bonds issued in different Series (as part of a Serial Bond) and maturing on different dates, and thus having different prices, are sometimes quoted this way for purposes of comparison, as are railroad equipment trust certificates, ...

See also: Certificate, Trust, Stock, Security, Investment