# GuideTrading sizes

**What do nominal value, face value, principal value and total cash consideration mean?**

**Nominal value is the same as face value**. Quoted trading sizes are always on a nominal basis unless specifically mentioned otherwise. Also, **coupon income is based on the nominal amount**.

For example, a $1,000,000 nominal position in a Eurobond that pays a 10% coupon per annum and is purchased at a 90% cash price, will pay a total coupon of $100,000 per annum to the investor. The 90% cash price is irrelevant in coupon income calculations, however is used to determine the “principal value” of the holding.

The **total cash consideration** is the total cash amount an investor requires in order to buy a Eurobond in the first place, which includes accrued interest.

Definition | Amount | Explanation |
---|---|---|

Nominal Amount | $1,000,000.00 | The amount an investor receives back at maturity. It is also the amount the coupon payment calculation is based on. |

Principal Amount | $900,000.00 | Clean Price x Nominal Amount |

Accrued Interest | $30,711.81 | Nominal Amount x Coupon Rate x (Settlement Date - Previous Coupon Date) / Day-Count Convention Year |

Total Consideration | $930,711.81 | Principal Amount + Accrued Interest |

**What is the minimum amount needed to invest in Eurobonds?**

When Eurobonds are issued, a **minimum nominal amount** is set to purchase the Eurobond.

At present, **$200,000 nominal** is the threshold for all Nigerian Eurobonds with a **$1,000 increment** thereafter. There is one exception, which is Nigeria’s June 2022 Diaspora Bond which has a nominal minimum of $2,000.

Nominal trading sizes **below $200,000 are possible**, either through the purchase of a **structured note** or a so-called **“buy/sell-back”** process. The latter is more common and largely depends on dealer willingness and inventory position.

Sub-nominal trading sizes, i.e. a nominal amount below the set minimum threshold, is generally referred to a "**fractional sizes**" or "**fractional bonds**". A separate section of the HowNoww guide is dedicated to **Fractional Bonds.**