NISM Series IV: Currency Derivatives Certification Exam Notes

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  • Deferred Coupon Bonds: No interest initially, high interest later, suitable for long gestation projects.
  • Deep Discount Bonds: ZCBs issued at a significant discount, typically for long-term projects.
  • Embedded Options: Call (issuer redeems early) or put (investor redeems early) options affect bond pricing.
  • Straight Bonds: Fixed coupon, no embedded options, also called plain vanilla bonds.
  • Callable Bonds: Issuer can redeem before maturity, often at a premium when rates fall.

NISM Interest Rate Derivatives

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