User Account

All Pages

Difference between bond ytm and its ytc

Assignment Help Finance Basics
Reference no: EM132785262

LHIN Inc.'s bonds is a 12% semi-annual coupon bond and have 15-year left until its maturity. It is currently selling for $1,250. The bond has a callable feature which allows LHIN Inc. to call the bond in 5 years at $1,050. What is the difference between this bond's YTM and its YTC? (i.e., calculate the YTM and YTC separately and determine the difference between these two rates)

Reference no: EM132785262

Questions Cloud

Explain risky portfolio and the risk-free asset : A portfolio has an expected rate of return of 10% and a standard deviation of 25%. The risk-free rate is 3.50%. An investor has the following utility function:
Optimal portfolio weight to invest in the risky asset : If the investor's coefficient of risk aversion constant A is 2.5, what is their optimal portfolio weight to invest in the risky asset?
Compute for the total interest income to be recognized : Compute for the total interest income to be recognized in 2020. Lucky company received four promissory notes from different individuals
Expected return for the non-optimal complete portfolio : Using the information from problem 4, the investor decides that the optimal weight to invest in the risky asset y* calculated in problem 4 seems too low
Difference between bond ytm and its ytc : What is the difference between this bond's YTM and its YTC? (i.e., calculate the YTM and YTC separately and determine the difference between these two rates)
Identify group of victims of some specific harmful activity : Identify a group of victims of some specific harmful activity who still has not been "rediscovered" or "socially constructed" as victims, and was not mentioned
Some persons consider the term business ethics : Some persons consider the term " business ethics" to be an oxymoron, Do you agree or not? Are the two words incompatible? Complementary?
Benefits of investing and trading in stock market : 1. What are the benefits of investing and trading in the stock market?
Difference in effective annual rates charged by two banks : TD Bank offers to lend you $50,000 at a nominal rate of 6.5%, simple interest, with interest paid monthly. Scotia Bank offers to lend you the $50,000

Reviews

Write a Review

Finance Basics Questions & Answers

  Calculate the annual capital cost allowance

Calculate the annual capital cost allowance (CCA) and end-of-the-year book value (UCC) for this equipment for the first seven years.

  Describe why your bond increased in value

In 1994, you purchased a $1,000 corporate bond issued by Boeing. At the time, the interest rate for the bond was 6 percent. Today, comparable bonds are paying.

  What is the duratio of the bond

What is the duratio of this bond? How much money would you collect if you reinvest all payments in a bond that also pays 9% and sell the bond after 5 years?

  Bianca took out a loan from the bank today for x

Bianca took out a loan from the bank today for X. She plans to repay this loan by making payments of 20,359 dollars per month for a certain amount of time.

  So why is it important to analyze the historical

pro forma financial statements by definition are predictions of a companys financial statements at a future point in

  What is the company wacc

Sixx AM Manufacturing has a target debt-equity ratio of 0.59. Its cost of equity is 14 percent, and its cost of debt is 8 percent.

  Compute the yield today

Suppose that a one-year Treasury securities yield 5%.The market anticipates that 1 year from now, one-year Treasury securities will yield 6 percent. So if the pure expectations theory is correct,

  A 1000 bond with a coupon rate of 54 paid semiannually has

a 1000 bond with a coupon rate of 5.4 paid semiannually has five years to maturity and a yield to maturity of 7.5. if

  Calculate the cash conversion cycle for woodside petroleum

FINM4000 - Calculate the cash conversion cycle for Woodside Petroleum for the financial year 2016. How does this compare with the cash conversion cycle in 2015

  Premium over par value and others sell at a discount

Why do some bonds sell at a premium over par value and others sell at a discount to par value?

  1you purchase a 20 year bond 1000 par value bond that pays

1.you purchase a 20 year bond 1000 par value bond that pays 8 interest semi-annually that can be called in 10 years at

  What do you think of project regarding irr decision rule

(IRR with uneven cash flows) TBC Bank is considering purchasing a new building for newly opened branch in region. Required rate of return for the project is 10.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd