A bond that does not pay periodic interest. Instead, it is sold at a discount to its face value, and the investor receives the full face value at maturity. Bond prices fluctuate with interest rates; rising rates generally reduce bond prices. Selling before maturity can result in gains or losses. Holding to maturity ensures repayment of principal plus interest, unless the issuer defaults. Zero-coupon bonds and other bonds carry risks including interest rate risk, call risk, market fluctuations, and default risk. Some municipal bonds may be subject to the alternative minimum tax or become taxable after purchase. Buying bonds at a premium can result in realized losses.