Term:
Liquid yield option note (LYON)
Definition:

A LYON combines the features of a zero-coupon bond with those of a convertible bond. The zero-coupon bond pays no interest until it is redeemed at or before maturity; the difference between the issue price and the redemption price represents the accrued interest. In addition, the LYON bond may be converted by the holder into stock of the issuing corporation within a specified period and at a specified conversion price.

Domain:
Finance
Source:
Coordinated Portfolio Investment Survey Guide, Second Edition, International Monetary Fund, 2002, Washington DC. Appendix VI: Definition and Description of Instruments
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