The term redemption has different uses in the finance and business world, depending on the context.
Types of Redemption
That an investor buys a $1,000 par value corporate bond at a discounted price of $900 and receives $1,000 par value when the bond is redeemed at maturity. The investor has a $100 capital gain for the year, and the tax liability for the gain is offset by any capital losses. If the same investor purchases a $1,000 par value corporate bond for $1,050 and the bond is redeemed for $1,000 at maturity, the $50 capital loss reduces the $100 capital gain for tax purposes.