Discuss different types-characteristics of debt instruments

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Discuss different types and characteristics of debt instruments with specific reference of Bonds. Due to covid19 the equity market exhibits down move and hence he considers it a risky investment. down so he considers it is quite risky. Mr. Sikander looking to have stable income. Mr. Sikander is a retired person and just received Amount 40,000,000 on account of different funds. He is looking to buy Bonds. Mr. Saleem a friend of Sikander suggested him to buy MCB bonds. The bond has 25 years' life and was issued 13 years ago. It pays 11.5 percent coupon rate with face value PKR 1050. Mr. Ahmed wants to make 14% profit from his investments.

a. Should Mr. Sikander buy MCB bond if it is currently selling at 930?

b. How many bonds can he buy if the bond is selling at calculated price?

c. Write features of Zero-coupon bond and why do investors buy it when they offer nothing periodically?

(Note:- Please provide your answer in PKR)

Reference no: EM132630782

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