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TeachMeFinance.com - explain range bonds range bonds -- bonds that stop paying an investor when the bond's reference rate is higher or lower than a predetermined range on an established index. The bonds pay an above-market coupon rate as long as the reference rate falls within the range. For example, if LIBOR is the index, a range bond might pay LIBOR plus 75 basis points for each day LIBOR is between 3.5 and 5 percent. When LIBOR is less than 3.5 percent or more than 5 percent, the bond accrues no interest. A range bond is a type of structured note. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2005 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.