Hi guys,
what is the difference between a bullet loan and a PIK bond? The principal payment is due at the end of maturity in both cases right? As well as the accrued interest which has to be paid at the end?
I don't know exactly where the difference is. Maybe I just interpreted the concepts wrong.
Would be glad if someone can help.
Thanks.
Apart from the overarching general difference between bonds and loans, which is that bonds are securities whereas loans are contractual agreements, bullet interest is normally paid twice a year whereas PIK interest accumulates and is paid off at the end.
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