Face Value

Face Value - The face value is a securities nominal dollar value assigned by the issuer. If it is a equity security, face value is generally a tiny amount that bears no relationship of any kind to its market price, except when they are preferred stock, which in this case, the face value is used when calculating dividend payments. On a debt security, face value is the value repaid to an investor when the bond matures with corporate bonds having a face value of one thousand, federal bonds around ten thousand, and municipal bonds around five thousand dollars. In secondary markets, bond price flux with interests rates. Face Amount Certificate - A face amount certificate is a kind of debt security, which is issued by a type of mutual fund known as a face amount certificate company. The debt holder has to make payments periodically to the issuer, at which the issuer agrees to pay the holder the face value of the mutual fund upon its maturity - of it could be a differing amount, depending on if the security is called before its maturity date. In this type of investment security, the original face is the important and distinguishing part of the information tied to the security.