TeachMeFinance.com - explain Premium
an amount paid on a regular schedule by a policyholder that maintains
premium -- (1) the amount, often stated as a percentage, paid in addition to the face value of a note or bond. (2) a fee charged for the granting of a loan. (3) the price paid for an insurance contract. (4) a product given free or sold at discount, offered as an inducement to the public to open or add to a savings account, or to purchase other specified products or services.
Premium -- 1. A bounty or bonus above a regular price, paid as an incentive to do something.
Premium -- The amount paid in excess of the par (face) value. When a stock, for instance, is selling at a premium the premium is the amount it brings beyond its par or face value. When a stock is lending at a premium (see Borrowing and lending stocks ) the premium is the amount paid by the borrower of the stock to the lender of it for the use of it. The purpose, usually, for which a stock is borrowed is to enable the borrower, who has sold it short (sold stock he did not possess), to make delivery to the purchaser. In Great Britain when a stock or other security is at a premium the premium is reckoned at so much in the pound on shares and at a percentage on stock or bonds . See Percentage.
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