Stock Market Glossary
Dirty price
Bond price including interest accrued since the last coupon payment.
In brief: Bond price including interest accrued since the last coupon payment.
Meaning in practice
The dirty price is the economic amount due when buying a bond: clean price plus accrued interest. Market quotes often show the clean price, so the actual payment can be higher. Yield comparisons and purchase decisions require clarity on which price convention is used.
Context for investors and traders
For investors, the term becomes practical in the context of objectives, time horizon, risk capacity and costs. A suitable solution can differ between two people even when they consider the same product or metric.
How to use this in practice
Use the term first to describe the situation and add verifiable data: time frame, benchmark, costs and liquidity. Only then does it become an assessment that can be connected to an investment objective and risk budget.
What to keep in mind
Avoid false precision. Many market terms describe probabilities or historical patterns; they neither guarantee a return nor replace the review of a specific security.