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KIC000027 - -mizz~ Characteristics of Debt...

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Unformatted text preview: -mizz~- Characteristics of Debt Securities (cont'd) I Liquidity uLiquld s can be easi convened to cash legs: a loss in vallge nsnoremammy sewrifieswith an active Ware liquid nSecurities with lower liquidity have to offer a higher yield tn be preferred if -i._ume:=;. , . Characteristics of Debt Securities (cont’d) l Taxstatus DInvestarsmmoreconoemedwihaftu—hxincmte fianbal‘ore-taxincorne .Tmmmwm-mmm tobeprstorrad DTheat'ter-taxyieldis equalln: Yat : Yb: (1 - T) Characteristics of Debt Securities (cont'd) I Tax status I: Computing the equivalent Winfield . Tl- bafou-tlx yield may tun-tut the liter-tum .smmmmmmmmum ...
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