'Discount bond' diaporamas de présentation

Unit 5 Investing

Unit 5 Investing. Unit 5 Vocabulary. Buying on Margin Collectables Common Stock Cyclical Stocks Defensive Stocks Direct Investing Discount Bond Discount Broker Diversification Dividend Reinvestment. Agency Bonds Annual Report Annuity Auction Market Back-end Load Bear Market

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LONG TERM DEBT - BOND VALUATION

LONG TERM DEBT - BOND VALUATION. Bonds. Type of debt or long-term promissory note, issued by a borrower, promising to its holder a predetermined and fixed amount of interest per year. Types of Bonds. Debentures Subordinated Debentures Mortgage Bonds Eurobonds Zero and Very Low Coupon Bonds

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CHAPTER 6 Bonds and Their Valuation

CHAPTER 6 Bonds and Their Valuation. Key features of bonds Bond valuation Measuring yield Assessing risk. Key Features of a Bond. 1. Par value: Face amount; paid at maturity. Assume $1,000.

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Term Structure: Tests and Models

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Chapter 9

Chapter 9. Debt Instruments Quantitative Issues. Learning Objectives. Bond Valuation Yield Measures Duration Managing Bond Portfolios Term Structure Factors affecting Prices/Yields. Five Bond Pricing Theorems. Bond prices move inversely to changes in interest rates

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Lecture 7: Measuring interest rate

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Understanding Interest Rates

Understanding Interest Rates. Chapter 4. Chapter Definitions. Present Value Yield to maturity Simple Loan Fixed payment loan Coupon bond Discount bond Rate of return and interest rate risk Real vs nominal interest rates. Yield to Maturity.

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Long-Term Liabilities

Chapter 14. Long-Term Liabilities. Bond Financing. A1. Advantages. Disadvantages. Bonds do not affect owner control. Bonds require payment of both periodic interest and par value at maturity. Interest on bonds is tax deductible. Bonds can decrease return on equity.

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Chapter 4 Understanding Interest Rates

Chapter 4 Understanding Interest Rates. The talk last Thursday was very comprehensive. I will add only a little bit content One video clip about John Howard, former Prime Minister of Australia. He promised no raise in interest rate. But interest rate was raised several times.

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Pricing Fixed-Income Securities

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Chapter 14

Chapter 14. Bond Prices and Yields. Provisions of Bonds. Secured or unsecured Call provision Convertible provision Put provision (putable bonds) Floating rate bonds Sinking funds. Bond Pricing. P B = Price of the bond C t = interest or coupon payments

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Bling-Bling Corporation

Bling-Bling Corporation. Must use IRR function, cannot use ex-post Uncovered Interest Parity, since loan not pure discount arrangement Complication: issue costs Issue cost % applies to the gross financing Gross-up the net financing. Bling-Bling Corporation.

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Opportunity Cost

Opportunity Cost. Value forgone for something else. Suppose a bank would pay 3.5%/year but you decide to keep $10,000 in your mattress . Opportunity cost of keeping in mattress as opposed to the bank is $350/yr. Why Time Value of Money?.

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