Compare this yiels to the ytm when you first bought the bond

Assignment Help Financial Management

Reference no: EM132063867

The Yield to Maturity (YTM) on a bond is the interest rate you earn on your investment if interest rates don't change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY).

Suppose that today you buy a 5.6% annual coupon bond for $930. The bond has 10 years to maturity. What rate of return do you expect to earn on your investment?

Two years from now, the YTM on your bond has declined by 1%, and you decide to sell. What price will your bond sell for? What is the HPY on your investment?

Compare this yiels to the YTM when you first bought the bond. Why are they different?

Reference no: EM132063867

Questions Cloud

Estimate the yield to maturity of a year bond : What is the yield to maturity of a 13-year bond that pays a coupon rate of 7.83 percent per year, has a $1,000 par value.

Acetazolamide or benzene sulfonamide : Which is the more effective inhibitor, acetazolamide or benzene sulfonamide? Explain your answer.

What price will your bond sell for : Compare this yield to the YTM when you first bought the bond. Why are they different?

Calculate the yield to maturity : Investors would not expect the bonds to be called and to earn the YTM because the YTM is less than the YTC.

Compare this yiels to the ytm when you first bought the bond : Suppose that today you buy a 5.6% annual coupon bond for $930. The bond has 10 years to maturity.

Describe the metabolic fates of phenylalanine : Describe the metabolic fates of phenylalanine; highlighting the synthesis and degradation pathways of catecholamines (dopamine, norepinephrine and epinephrine)

Discuss the advantages to genetically modifying plants : Discuss the advantages to genetically modifying plants compared to traditional crossbreeding techniques. Now, discuss any disadvantages.

What are the 5 properties of regulatory enzymes : 1) What are the 5 properties of regulatory enzymes? 2) What is the effect of molecular crowding at the replication fork?

Or would they produce the same amount of product : Two isozymes E1 and E2 catalyze the same reaction in different tissues and have the same Vmax. However, E1 has a KM of 30 nM, while E2 has a KM of 100 nM

User Account

All Pages