Chapter 7Breaking Par

“Perfect numbers, like perfect men, are very rare.”

—Rene Descartes

In golf, “par” denotes an ideal score for the best golfers, but the generally accepted definition of par is merely “average or ordinary.” Therefore, “above par” has come to mean an above-average or extraordinary event.

In the financial markets, trading “above par”—above the psychologically significant number of 100—is considered an important market milestone. If the price of a bond is trading above 100 (for example, at 106), it’s trading “above par” and at a “premium.” This is a sign of strength. If the same bond falls and subsequently trades down to 94, it would be trading at a “discount” or “under par.”

Although the number 100 should have no greater ...

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