Copyright ©2004 Pearson Education, Inc. All rights reserved. Chapter 16 Investing in Bonds.
Interest-Rate Risk II. Duration Rules Rule 1: Zero Coupon Bonds What is the duration of a zero-coupon bond? Cash is received at one time t=maturity weight.
7-1 CHAPTER 7 Bonds and Their Valuation Key features of bonds Bond valuation(price) Measuring yield(return) Assessing risk.
Lecture 4 Various Interest Rates Various Interest Rates and Their Relationships An interest rates is the price to exchange money tomorrow for money today.
Contemporary Investments: Chapter 9 Chapter 9 FIXED INCOME SECURITIES: VALUATION AND RISKS Why are bonds viable investment alternatives? What are the risks.
Review Bond Yields and Prices. Learning Objectives Calculate the price of a bond. Calculate major bond yield measures, including yield to maturity, current.
The Bond Market Meghan Barnes April 10, 2002. Overview Bonds and Bond Purchasers Issuers of Bonds Common Types of Bonds Bond Prices Measures of Yield.
Commerce 4FJ3 Fixed Income Analysis Week 8 CMBS and Asset Backed Securities.
Valuing Cash Flows Non-Contingent Payments. Non-Contingent Payouts Given an asset with payments (i.e. independent of the state of the world), the asset’s.
DES Chapter 2 1 Chapter 2 A Complete Corporate Valuation for a Simple Company.
