Clean Price

In finance, the clean price is the price of a bond excluding any interest that has accrued since issue or the most recent coupon payment. This is to be compared with the dirty price, which is the price of a bond including the accrued interest.

Clean Price = Dirty Price - Accrued Interest

When bond prices are quoted on a Bloomberg Terminal or Reuters they are quoted using the clean price. The clean price is mostly quoted in the US bond markets. Given the quotes, traders tend to think of bonds in terms of their clean prices.

Clean prices are more stable over time than dirty prices – when clean prices change, it is for an economic reason, for instance a change in interest rates or in the bond issuer's credit quality. Dirty prices, on the other hand, change day to day depending on where the current date is in relation to the coupon dates, in addition to any economic reasons.

Bond market
  • Bond
  • Debenture
  • Fixed income
Types of bonds by issuer
  • Agency bond
  • Corporate bond
  • Distressed debt
  • Emerging market debt
  • Government bond
  • Municipal bond
Types of bonds by payout
  • Accrual bond
  • Auction rate security
  • Callable bond
  • Commercial paper
  • Convertible bond
  • Exchangeable bond
  • Extendible bond
  • Fixed rate bond
  • Floating rate note
  • High-yield debt
  • Inflation-indexed bond
  • Inverse floating rate note
  • Perpetual bond
  • Puttable bond
  • Reverse convertible
  • Zero-coupon bond
Bond valuation
  • Clean price
  • Convexity
  • Coupon
  • Credit spread
  • Current yield
  • Dirty price
  • Duration
  • I-spread
  • Mortgage yield
  • Nominal yield
  • Yield to maturity
  • Z-spread
Securitized products
  • Asset-backed security
  • Collateralized debt obligation
  • Collateralized mortgage obligation
  • Commercial mortgage-backed security
  • Mortgage-backed security
  • Yield-curve spread
Bond options
  • Callable bond
  • Convertible bond
  • Embedded option
  • Exchangeable bond
  • Extendible bond
  • Option-adjusted spread
  • Puttable bond
Institutions
  • Commercial Mortgage Securities Association (CMSA)
  • International Capital Market Association (ICMA)
  • Securities Industry and Financial Markets Association (SIFMA)


Famous quotes containing the words clean and/or price:

    A soul that makes virtue its companion is like an over-flowing well, for it is clean and pellucid, sweet and wholesome, open to all, rich, blameless and indestructible.
    Epictetus (c. 50–120)

    The price we pay for the complexity of life is too high. When you think of all the effort you have to put in—telephonic, technological and relational—to alter even the slightest bit of behaviour in this strange world we call social life, you are left pining for the straightforwardness of primitive peoples and their physical work.
    Jean Baudrillard (b. 1929)