What is the realized yield of investment

Assignment Help Finance Basics
Reference no: EM132660507

Assume the current 10-year yield is 1%. All yields are BEYs.

a) Imagine you just bought a 1% coupon ten-year T-bond, how much you have paid for it? Assume a par of $100. The 1% coupon is paid semi-annually.

b) You plan to hold the bond for ONE year. Assume the yield stays at 1% during the year but goes up to 2.5% the minute before you sell the bond at the end of the year. Compute the total dollar return and its three components (coupon interest, interest on interest, capital gain or loss) for your investment. What is the realized yield (BEY) of your investment?

Reference no: EM132660507

Questions Cloud

Evaluate key business activities of engineering organisation : Evaluate the key business activities of an engineering organisation and the trade considerations which together combine to influence the competitiveness
Calculate the company break-even point in unit sales : Mauro Products distributes a single product, a woven basket whose selling price is $22 per unit and whose variable expense is $20 per unit. The company's monthl
Describe the factors to consider when doing a swot analysis : Describe what you found in relating the two different SWOT analyses (e.g., what things were addressed, what new environmental factors came up, and so forth).
What is Elliot qualified business income deduction : Elliot's wife, Julie, is an attorney who works for a local law firm and receives wages of $90,000. What is Elliot's qualified business income deduction
What is the realized yield of investment : You plan to hold the bond for ONE year. Assume the yield stays at 1% during the year but goes up to 2.5% the minute before you sell the bond
What is Ting qualified business income deduction : Ting is a CPA and a single taxpayer using the standard deduction. What is Ting qualified business income deduction
What is Susan qualified business income deductions : Susan has no other items of income or loss and will take the standard deduction. What is Susan's qualified business income deduction
Discuss the atos test case litigation program : Discuss the ATOs Test Case Litigation Program - Alice will receive a salary of $25,000 for the management of the shop, as well as superannuation contributions
What is her qualified business income deduction : Tammy, a single taxpayer, has a part-time job at BigCo, a company in which she has no ownership interest. What is her qualified business income deduction

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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!

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