OID = Original Issue Discounthttp://www.investopedia.com/terms/o/oid.aspSinking Fund:http://www.investopedia.com/ask/answers/05/053105.aspNot sure that will give you the advice you are seeking, but at least it handles the definitions.I don't think you can count at all on the ratings to actually provide you with that simplistic a percentage. In any event, even if your DD allows you to come to the conclusion that there is an 80% chance of survival, that doesn't really help on an individual bond basis. The result will be either 100% (all payments met and $1000 returned at maturity) or some other value (unlikely to be 80%) that comes from the total of payments received and some work-out value in the bankruptcy. For corporates, one can make some assessment based on the assets of the company. For muni's, I'm not sure how a bankruptcy would work. I suspect it depends on whether the bond is backed by some income stream of the underlying asset that the bond funded or whether it's a general fund obligation.Regards,Les - who bought his first individual bond last week, but used Charley's spreadsheet formulas for calculating yield. Pretty sure I didn't get a great bargain, but you have to start somewhere and the amount was small (and it apparently last traded 3% higher than I paid). Learn by doing.
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