Investor Glossary-base interest rateInvestor Glossary-base interest rateInvestor Glossary-base interest rateInvestor Glossary-base interest rateInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Base Interest Rate

The HTML to link to this page
 

The base interest rate is the lowest interest rate that investors will accept for investing in a non-Treasury security. The base interest rate is pegged to the interest rate of the most recently-issued (also known as an on-the-run) Treasury of comparable duration. Since Treasuries represent the lowest-risk investment available, the base interest rate is generally the same rate as a comparable Treasury plus a small premium (known as the base interest rate premium) which reflects the added risk of a non-Treasury investment. When an interest rate is offered that is substantially higher than the base interest rate, it is often because the investment has an inherent added risk. The base interest rate is also known as the benchmark interest rate.



Rate this base interest rate definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: in escrow, wholly-owned subsidiary, risk management, phantom income, class C shares, deferred tax, minority interest, 1031 exchange, command economy, stock market close, VIX, 144a, average price per share, cancelled check, deferred revenue, 401a, 1035 exchange, EBITDA, required rate of return, debt service coverage, option premium, current ratio, margin rate, open position, limit order, reverse mortgage, FICO score, Zero Cost Collar, covered put, ex-dividend, FTSE, real GDP, liquidity ratio, LIBOR, labor relations, balance sheet, implied volatility, Key Rate Duration, irrevocable trust, diluted share, quality assurance, retained earnings, stock split, inflation, APR, ex-dividend date, dividends payable, annual return, per diem


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Investor Glossary | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use