A perpetual bond, also known colloquially as a perpetual or perp, is a bond with no maturity date,[1] therefore allowing it to be treated as equity, not as debt. Issuers pay coupons on perpetual bonds forever, and they do not have to redeem the principal. Perpetual bond cash flows are, therefore, those of a perpetuity.

Perpetual bonds vs. equity



Perpetual bonds are valued using the formula:


See also


  1. ^ Types of Bonds: The Valuation of Long-Term Securities
  2. ^ "Oldest active bond". Guinness World Records. Retrieved 2022-11-20.
  3. ^ Wigglesworth, Robin (2023-08-09). "The world's oldest living bond". Financial Times. Retrieved 2023-09-30.
  4. ^ a b Goetzmann, William N.; Rouwenhorst, K Geert (2023). "Infinity has a price". Yale Alumni Magazine. 86 (4): 48–49. Retrieved 11 March 2023.
  5. ^ Scott, Tom, "The centuries-old debt that's still paying interest", YouTube, retrieved 2022-11-20
  6. ^ Cummings, Mike (2015-09-22). "Yale's 367-year-old water bond still pays interest". YaleNews. Retrieved 2021-11-15.
  7. ^ Choudhury, Indrajit Roy (2015-09-16). "Some Perpetual Bonds Are More Eternal Than Others". Indrosphere. Retrieved 2021-11-15.
  8. ^ "BOND VALUATION". Archived from the original on 2015-04-21. Retrieved 2010-10-03.