Step-up (step down) notes, Financial Management

Assignment Help:

These types of securities have more than one coupon rate and each subsequent coupon rate is higher (or lower) than the previous coupon rate. For example, a 10 year step-up note (or step down note) might have a coupon rate that is 10% for the first five years and 11% (or 9%) for the last five years or, the step-up note (or step down note) could call for a 10% coupon rate for the first three years, 10.5% (or 9.5%) for the fourth and fifth year and 11% (or 9%) for the remaining five years. When there is only one change (or step up or step down) like the first example, then it is known as a single step-up note (or step down note). When there is more than one change then it is known as a multiple step-up note (or step down note) like the second example.  


Related Discussions:- Step-up (step down) notes

Financial services industry role, For this assessment, you will be required...

For this assessment, you will be required to select a role within the financial services industry that interests you. Undertake your own research to find out about the role you hav

Indexed bonds, In indexed bonds, the principal and coupon payme...

In indexed bonds, the principal and coupon payments are linked to the market index like inflation and price index. Index bonds are attractive to investors

Types of dividend policy, TYPES OF DIVIDEND POLICY 1. Regular dividen...

TYPES OF DIVIDEND POLICY 1. Regular dividend policy: Payment of dividend at standard rate is known as regular dividend policy. 2. Stable dividend policy: Payment of fix

Definition of cost of capital, Definition of cost of capital In analyzi...

Definition of cost of capital In analyzing the cost of capital it is presumed that business risk of the firm remains unchanged (i.e., that projects accepted don't affect the va

Please help me solve this question, there are 3 compaies i have to find out...

there are 3 compaies i have to find out the price of equity share by using walters and gordons model.

Cash flow, how do you find total cash outflow through maturity

how do you find total cash outflow through maturity

calculate the value of the bond, a.) A bond of Rs. 1000 value carries a co...

a.) A bond of Rs. 1000 value carries a coupon rate of 10% and has a maturity period of 6 years. Interest is payable semi-annually. If the required rate of return is 12%, calculate

Cross-sector analysis, Cross-Sector Analysis: The growth of a country d...

Cross-Sector Analysis: The growth of a country depends upon how fast a country can adapt to deregulation and internationalization. Deregulation and internationalization put com

Classification of sources of finance, CLASSIFICATION OF SOURCES OF FINANCE ...

CLASSIFICATION OF SOURCES OF FINANCE In the market, there are several sources of finance, with conflicting risk characteristics and with conflicting cost structures. Numerous m

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