Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Illustration
Discount bond (5 yr. bond with 10% coupon) (expected rate yield at 12%)
Premium bond (expected yield at 7.8%)
5
92.6
109.0
4
93.8
107.4
3
95.1
105.8
2
96.5
104.0
1
98.2
102.0
0
100.0
Reasons for price changes of a bond:
Change in the yield requirement of the issuer due to changes in the quality of credit of the issuer.
Change in the price as the bond approaches maturity in case of premium or discount bond.
Change in the price because of change in the yields of comparable bonds/securities.
While computing the bond pricing, the following assumptions are made:
Cash flows are known.
Coupon payment annually/semi-annually is made at exact period.
Required yield can be estimated.
One rate is used to discount all cash flows, i.e., with required yield rate.
The following cash factors are to be considered:
For callable bonds, cash flows cannot be certain. The investment decisions of the issuer depend on interest rate movements and other factors.
It is not possible to determine the appropriate yields and it need not be a single rate for all the future cash flows.
What is the time value of money? The time value of money signifies that money you hold in your hand today is worth more than money you expect to receive in the future. Likewise
Question 1 ) A Globalization is a procedure of international integration that arises due to increasing human connectivity as well as the interchange of products, ideas and other ph
Introduction When financial assets or bonds are pooled together and offered to the investors for receiving the inflow of funds from these underlying
calculate payback period of each project and according to payback whice project should be accepted
How would you explain economic exposure to exchange risk? Answer: Economic exposure can be illustrated as the opportunity that the firm’s cash flows and so its market value may
Explain about the in-quote-driven according to trade intermediation. In quote-driven dealer markets, a market-maker or dealer is onto one side of each trade. (Remember that dea
Assume that you have been consistently impressed by David and Tom Gardner of The Motley Fool since you first heard of their rather improbable rise to prominence in financial circ
Applicant should have been well versed in the calculation of actuarial losses and gains on pensions. It would have been significant to ensure each item affecting liabilities and as
In general, what type of firm would benefit from the use of a preauthorized check system and what specific types of companies have successfully used this device to accelerate cash
Question 1 State the key functions of the financial market. Question 2 Define "Bill of exchange". What are its features? Give different types of cheques. Question 3
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd