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GLOSSARY

STRIPPED BOND

 

Tradable security with periodic coupons which can be stripped and traded separated from the principal, so that a security with n periodic coupon payments becomes n+1 (including the principal) zero coupon bonds. In the case of Government Debt, only Market Makers can conduct this transaction. In the sphere of trading, clearing and payment, it refers to strips that must be made on nominal amounts of multiples of €100,000, with a minimum of €500,000. Furthermore, the nominal value of the stripped principals and of the stripped coupons is €100,000 and €1,000, respectively.
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