Bond Valuation with Duration
Assumptions				Conclusions
Par or Face Value		$1,000.00		RRR to Maturity
Years to Maturity		3		Yield to Maturity
Coupon Rate		4.00%		Your Intrinsic Value
Payments/Year		1
Coupon PMT Amount				Current Market Price		$1,050.00
Risk Free Rate to Maturity		0.23%		Duration to Maturity
Issuer's Risk Spread		1.80%
	Cash Flows to Maturity
Maturity (Years)	Purchase Price and Par Repayment	Coupon Payments	Total Cash Flows	PV of Cash Inflows	(CF PV)x (Maturity)
0.0	($1,050.00)
1.0
2.0
3.0	$1,000.00
			Sum =
1) Fill in all the empty boxes with the correct values. (Please add in excel formulas as well)
2) Should you purchase this bond? Why?
3) If RF rates go up by 10 bps and issuer's credit spread widens by 90 bps,
what does duration estimate the bonds value change will be?
	Callable Bond Valuation
	Assumptions
	Current Market Price			(Bid 119 / Offer 120)
	Par or Face Value		$1,000
	Call Premium		$20
	Call Price		$1,020
	Years to Maturity		10
	Years to Call		2
	Coupon Rate		7.00%
	Payments/Year		2
	2 Year UST Yield			1.65%
	10 Year UST Yield			1.85%
	Issuer's Risk Spread (to Call)			0.75%
	Issuer's Risk Spread (to Maturity)			1.25%
	YTC =
	YTM =
	Price to Call =
	Price to Maturity =
	Buy or Don't Buy? Why?