A CUSIP number is the primary unique identifier used for US bonds. There are CUSIP numbers for most US traded securities. However, the CUSIP number has primary importance in the bond market, where it is used to process and settle trades.
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Where most stocks have a 3 or 4 letter ticker symbol to identify them (ie AAPL for Apple stock or BAC for Bank of America), the bond market uses the 9 Character CUSIP Number.
According the accounting firm Grant Thorton, there were 5,091 publicly traded companies in the US as of February 2010. While some companies have several types of stock (preferred, common), it is very unusual for a company to have more than 3 classes of stock. At most, there are 20,000 unique stock issues of publicly traded companies. There are well over 1,000,000 different bond issues. Most of these bond issues are municipal bonds issued by cities, counties, and states. With so many different bond issues, precise identification is critical.
912828 + NB + 2 would be 912828NB2 CUSIP #
Having a CUSIP number in most cases is critical to finding information on a particular bond. If you own a bond, your broker should be able to provide the CUSIP number. If you are looking for information on a bond you do not already own and don’t know the CUSIP number, Fidelity has a nice tool here that will allow you to search for it using other criteria.
CUSIP is the acronym for the Committee on Uniform Security Identification Procedures. It is a system for identifying securities which was started in 1964. The system is owned by the American Bankers Association, and CUSIP is administered by Standard and Poors.
For more information on individual bonds, visit our Free Guide to Investing in Corporate Bonds.Want to learn how to generate more income from your portfolio so you can live better? Get our free guide to income investing here.