Open Yale CoursesECON 251: Financial TheoryLecture 9 - Yield Curve Arbitrage<< previous session | next session >>Overview:Where can you find the market rates of interest (or equivalently the zero coupon bond prices) for everymaturity? This lecture shows how to infer them from the prices of Treasury bonds of every maturity, firstusing the method of replication, and again using the principle of duality. Treasury bond prices, or at leastTreasury bond yields, are published every day in major newspapers. From the zero coupon bond prices one
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