principal

1. The face amount of a bond. Once a bond has been issued, it may sell at more or less than its principal amount, depending on changes in interest rates and the riskiness of the security. At maturity, however, the bond will be redeemed for its principal amount. Also called principal amount.
2. Funds put up by an investor.
3. The person who owns or takes delivery of an asset in a business transaction. For example, the owner of a home (the principal) contracts with a broker to list the home for sale.