ABOVE PAR

It is a term that is used to describe a security’s price when it is being traded above its actual face value. Usually, a security is being traded at above par when the income distributions of that security are comparatively higher than the other financial instruments that are currently available and being traded in the market.

When an investor acquires a security in its above face value, the investor will have a capital loss when it is redeemed at maturity for face value.