chap_06 - Chapter 6 INTEREST RATES AND BOND VALUATION...

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Chapter 6 INTEREST RATES AND BOND VALUATION SLIDES 6.1 Key Concepts and Skills 6.2 Chapter Outline 6.3 Bond Definitions 6.4 PV of Cash Flows as Rates Change 6.5 Valuing a Discount Bond with Annual Coupons 6.6 Valuing a Premium Bond with Annual Coupons 6.7 Graphical Relationship Between Price and YTM 6.8 Bond Prices: Relationship Between Coupon and Yield 6.9 The Bond Pricing Equation 6.10 Example 6.1 6.11 Interest Rate Risk 6.12 Figure 6.2 6.13 Computing YTM 6.14 YTM with Annual Coupons 6.15 YTM with Semiannual Coupons 6.16 Table 6.1 6.17 Example: Spreadsheet Strategies 6.18 Differences Between Debt and Equity 6.19 The Bond Indenture 6.20 Bond Classifications 6.21 Bond Characteristics and Required Returns 6.22 Bond Ratings – Investment Quality 6.23 Bond Ratings – Speculative 6.24 Government Bonds 6.25 Example 6.3 6.26 Zero-Coupon Bonds 6.27 Floating Rate Bonds 6.28 Other Bond Types 6.29 Bond Markets 6.30 Example: Work the Web 6.31 Bond Quotations 6.32 Treasury Quotations 6.33 Inflation and Interest Rates 6.34 The Fisher Effect 6.35 Example 6.6 6.36 Term Structure of Interest Rates
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A-64 INTEREST RATES AND BOND VALUATION SLIDES – CONTINUED CHAPTER WEB SITES Web sites may be referenced more than once in a chapter. This table just includes the section for the first reference. Chapter Section Web Address 6.1 bonds.yahoo.com personal.fidelity.com money.cnn.com/markets/bondcenter/latestrates.html www.bankrate.com investorguide.com 6.2 www.investinginbonds.com www.bondsonline.com www.bondresources.com www.e-analytics.com www.bondmarkets.com www.sec.gov 6.3 www.standardandpoors.com www.moodys.com www.fitchinv.com 6.4 money.cnn.com www.publicdebt.treas.gov/gsr/gsrlist.htm 6.5 research.stlouisfed.org/fred/files www.publicdebt.treas.gov/of/ofaucrt.htm 6.6 www.bloomberg.com/markets www.smartmoney.com What’s On The Web? www.stls.frb.org CHAPTER ORGANIZATION 6.1 Bonds and Bond Valuation Bond Features and Prices Bond Values and Yields Interest Rate Risk Finding the Yield to Maturity: More Trial and Error 6.37 Figure 6.6 – Upward Sloping Yield Curve 6.38 Figure 6.6 – Downward Sloping Yield Curve 6.39 Figure 6.7 – Treasury Yield Curve 6.40 Factors Affecting Required Return 6.41 Quick Quiz
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CHAPTER 6 A-65 6.2 More on Bond Features Is it Debt or Equity? Long-Term Debt: The Basics The Indenture 6.3 Bond Ratings 6.4 Some Different Types of Bonds Government Bonds Zero Coupon Bonds Floating-Rate Bonds Other Types of Bonds 6.5 Bond Markets How Bonds are Bought and Sold Bond Price Reporting 6.6 Inflation and Interest Rates Real versus Nominal Rates The Fisher Effect 6.7 Determinants of Bond Yields The Term Structure of Interest Rates Bond Yields and the Yield Curve: Putting It All Together Conclusion ANNOTATED CHAPTER OUTLINE Slide 6.1 Key Concepts and Skills Slide 6.2 Chapter Outline 6.1. Bonds and Bond Valuation .A Bond Features and Prices Bonds – long-term IOU’s, usually interest-only loans (interest is paid by the borrower every period with the principal repaid at the end of the
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chap_06 - Chapter 6 INTEREST RATES AND BOND VALUATION...

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