Face value

The named value of a bond or other financial instrument as stated on the document. Face value is usually the amount paid when a bond is initially bought from the issuer, unless it is a discount bond, and is also the amount repaid when the bond matures, unless the issuer defaults. However, once bonds are traded on the secondary markets, their value changes regularly. Face value can also refer to the amount to be paid out on an insurance policy on death or when it matures. This is also known as the par value.

This definition is for general information purposes only