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Bond Quotes

# Bond Quotes - 2 Yield to Maturity 0.0500 Another Example...

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Bond Quotes Bond prices are quoted as a % of par value . If the quote is 110, the purchase price is 110% (1.10) of par. This is a convenient since it applies to any par amount. For a par value of \$1,000: » (\$1,000)(1.1) = \$1,100 For a par value of \$100,000: » (\$100,000)(1.1) = \$110,000 1

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Rate Using Excel Bond calculations can be done in Excel. No adjustment to rate is needed. 2 Calculating Bond Yields Settlement Date 1/1/2000 Maturity Date 1/1/2012 Annual Coupon Rate 0.08 Bond Price (% of par) \$126.83 Face Value (% of par) 100 Face Value and Bond Price are expressed as a percentage of Face Value Coupons per Year

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Unformatted text preview: 2 Yield to Maturity 0.0500 Another Example • For this bond: 1. Detail the cash flows on a timeline. 2. Confirm the price. 3 Later Another Example 4 • For this bond: 1. Detail the original cash flows on a timeline. 2. Confirm the price. Another Example 5 • For this bond: 1. Detail the original cash flows. 2. Confirm the price. Solve for PV ▫ Enter 27, then N (2/2009 - 2/2022) ▫ Enter 5.473 / 2, then I/Y ▫ Enter 42.5, then PMT [(\$1,000 x .085) / 2] ▫ Enter 1000, then FV ▫ Enter CPT , then PV P0 = \$1,286.26 128.63 (% of par)...
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