Concept of yield spreads, Financial Management

Assignment Help:
  • The Central Bank is an authority responsible for monetary policy of its country. It regulates money supply and credit, issues currency, and manages exchange rate.  It strives to maintain the stability of its national currency and money supply. It works with different policy tools like open market operations, bank reserve requirements, interest rate policy, capital requirements, exchange requirements, etc.

  • Treasury yield curve is the curve pertaining to treasury securities. It is the most common yield curve used as a base rate for its high liquidity and riskless nature.

  • Yield spread can be measured in terms of either absolute yield spread or relative yield spread. A yield spread between any two bond issues can be easily computed when the maturity date for both these issues is same.

  • Liquidity spreads are the spreads visible in the secondary markets for treasury securities. On-the-run treasuries are the treasury securities wherein the liquidity spread is more visible by virtue of its less liquidity and frequent trading in the secondary markets.


Related Discussions:- Concept of yield spreads

What is dividend decision, What is Dividend Decision Determination o...

What is Dividend Decision Determination of funds requirements and how much of itwould be generated from internal accruals and how much to be sourced from outsideis a crucial

Briefly explain what is trem card, Q. Briefly explain What is TREM Card? ...

Q. Briefly explain What is TREM Card? 1. As per National and international regulations, the drivers of vehicles carrying hazardous goods should have the documentation outlining

Long term investement and financial decisions, you would like to purchase a...

you would like to purchase a new car in 3 years.The current value of the vehicle you would like to purchseis 100000.The manufacturer of the vehicle has advised you,that the cost of

Payback period, Payback Period It is an amount of time, mainly measured...

Payback Period It is an amount of time, mainly measured in years; it takes previously the undiscounted cash inflows from a project equal the cash outflow. It indicates the leng

Structure and participation of hedge funds, Structure and Participation of ...

Structure and Participation of Hedge Funds: The typical structure for a Hedge Fund is to facilitate the tax concerns of investors and fund managers. Basically, there are two or

Fixed costs, Fixed Costs The costs a rigid incurs doing business that d...

Fixed Costs The costs a rigid incurs doing business that do not change in relation to production. Rent, for example, is a fixed cost because it remains constant whether product

Treasury bonds or t-bonds or the long bond, Treasury bonds are the bo...

Treasury bonds are the bonds issued with maturities greater than 10 years. However, these are commonly issued with a maturity of 30 years. Like T-notes, these bon

Define price ceiling make consumers better off, How can a price ceiling mak...

How can a price ceiling make consumers better off?  Under what conditions might it make them worse off? If the supply curve is completely inelastic a price ceiling will raise c

Forecasting yield volatility, There are several methods available to ...

There are several methods available to forecast yield volatility. But before that, let us look into the calculation of forecasted standard deviation. Assume th

Advantages and disadvantages of closed end country funds, Discuss the advan...

Discuss the advantages and disadvantages of closed-end country funds or CECFs relative to the American Depository Receipts or ADRs as a means of international diversification. An

Write Your Message!

Captcha
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