Bond XYZ has 6 years to maturity, pays a coupon based on the 3-month T-bill rate...
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Bond XYZ has 6 years to maturity, pays a coupon based on the 3-month T-bill rate plus 180 bps, makes coupon payments quarterly, and is currently quoted at a price of 87. The 3-month T-bill rate is currently 5%. What is the bond's discount margin? Bond XYZ has 6 years to maturity, pays a coupon based on the 3-month T-bill rate plus 180 bps, makes coupon payments quarterly, and is currently quoted at a price of 87. The 3-month T-bill rate is currently 5%. What is the bond's discount margin?
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To calculate the bonds discount margin we need to follow these steps Step 1 Determine the bonds annual coupon rate The bond pays a coupon based on the ... View the full answer
Related Book For
Introduction to Operations Research
ISBN: 978-1259162985
10th edition
Authors: Frederick S. Hillier, Gerald J. Lieberman
Posted Date:
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