Investing Tax Free


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Call Feature - (or Called) The issuer's right to redeem outstanding bonds before their scheduled maturity. The dates when an issuer may call bonds are specified in the official statement of every issue that has a call provision in its indenture.


Callable Bond - A bond which may be redeemed by the issuer on specified dates prior to maturity.


Certificate of Participation - (COP) An ownership interest in a municipal lease obligation and its attendant tax-exempt interest and principal payments.


Coupon - A bond 's semiannual interest payment; the detachable part of a bearer bond that identifies amount and payment date of each interest payment.


Coupon Rate - The annual rate of interest payable on a coupon security expressed as a percentage of the principal amount.


Coverage - A term usually connected with revenue bonds; the margin of safety for payment of debt service, reflecting the number of times (e.g., 2 to 1) by which annual revenues, either on a gross or net basis, exceed annual debt service.


Credit - A loan or bond.


Crossover - (or Crossover Refunding) In a crossover refunding, the revenue stream originally pledged to secure the bonds being refunded continues to be used to pay debt service on the refunded bonds until they mature or are called. At that time the pledged revenues "cross over" the pay debt service on the refunding securities.


Current Yield - An annual interest payment divided by the market price of a bond, expressed as a percentage. Also know as "stock yield."


CUSIP Number - (Committee on Uniform Securities Identification Procedures) A nine-digit identification number assigned to each maturity of an issue. The CUSIP numbers are intended to help facilitate the identification and clearance of municipal securities.