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

Bonds with warrants, Bonds with Warrants: Warrants are usually attached...

Bonds with Warrants: Warrants are usually attached with the bonds or preference shares to attract the investor. The objective is to induce the potential investors to subscribe

Operating cycles, use the operating cycle to formulate a broiler business

use the operating cycle to formulate a broiler business

Introduction to financial management, Introduction to financial management:...

Introduction to financial management: Meaning and defecation of the financial management Finance function Scope and content of financial function Functions and

Market condition affecting cost of capital, Q. Market condition Affecting c...

Q. Market condition Affecting cost of capital? Market condition: if an investor is purchasing a security where the risk of the investment in significant the opportunity for add

Explain net present value method, Q. Explain Net Present Value Method? ...

Q. Explain Net Present Value Method? Net Present Value (NPV) Method: - This process measures the Present value of returns per rupee invested. In this method present value of

Please identify the largest potential threat, Using Southwest Airlines as a...

Using Southwest Airlines as an example, please identify the largest potential threat, the strategy employed, and what types of capital budgeting projects would be used to operation

What can financial institution do for deficit economic unit, What can a fin...

What can a financial institution Frequently do for a deficit economic unit (DEU) that it would have difficulty doing for itself if the DEU were to deal directly along with an SEU?

Cash management - managing excess cash, Cash management is about managing ...

Cash management is about managing excess cash also. The response of management must depend on whether the surplus is large and how long it is likely to exist. If the balance is

Average Return, How do I calculate the average return for T over a five yea...

How do I calculate the average return for T over a five year period?

Shareholders versus managers, Shareholders versus Managers A Limited Li...

Shareholders versus Managers A Limited Liability company is possessed by the shareholders though in most of the cases is managed by a board of directors selected by the shareho

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