Question: Why do market participants in some countries prefer to use
Why do market participants in some countries prefer to use the swap curve rather than the government bond yield curve?
Answer to relevant QuestionsA client observes that a corporate bond that he is interested in purchasing with a triple A rating has a benchmark spread that is positive when the benchmark is U.S. Treasuries but negative when the benchmark is the LIBOR ...Answer the below questions. (a) What is a yield curve? (b) Why is the Treasury yield curve the one that is most closely watched by market participants? Why is a stripped Treasury security identified by whether it is created from the coupon or the principal? Suppose that the price of a Treasury bill with 90 days to maturity and a $1 million face value is $980,000. What is the yield on a bank discount basis? “A floating-rate note and an extendable reset bond both have coupon rates readjusted periodically. Therefore, they are basically the same instrument.” Do you agree with this statement?
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