Related Words

Principal: In commercial law, the principal is the amount that is received, in the case of a loan, or the amount from which flows the interest.

Notional Principal Amount: In an interest rate swap, the predetermined dollar principal on which the exchanged interest payments are based.

Principal-Agent Relationship: Occurs when one person, an agent, acts on the behalf of another person, the principal.

Annuity Principal: The annuity principal is the sum of money you use to buy an annuity and the base on which annuity earnings accumulate. If you’re buying a deferred annuity, you may make a one-time — or singl . . . View Full Definition

Principal-Only (PO): A mortgage-backed security (MBS) whose holder receives only principal cash flows on the underlying mortgage pool. All the principal distribution due from the underlying collateral pool is pa . . . View Full Definition

Principal Exchange-Rated-Linked Securities (PERLS): A debt instrument with its principal and interest denominated in U.S. dollars, but with principal repayment depending on the exchange rate of the U.S. dollar against a foreign currency.

Principal Amount: The face amount of debt; the amount borrowed or lent. Often called principal.

Principal Point: Point from which the focal length is measured. The principal point of a simple lens is located at the center of the lens. Compound lenses have two principal points, the location of which can . . . View Full Definition

Remaining Principal Balance: The amount of principal dollars remaining to be paid under a mortgage as of a given time.

Principal Planes: Imaginary lines which pass through the nodal planes of a lens system.