Why is the bid-ask spread a transaction cost?

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Introduction To Derivatives And Risk Management

ISBN: 9781305104969

10th Edition

Authors: Don M. Chance, Robert Brooks

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Question Posted: Apr 07, 2016 08:30 AM

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Locate the Treasury bond in Figure 7.4 maturing in August 2029. Is this a premium or a discount bond? What is its current yield? What is its yield to maturity? What is the bidask spread?
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Why is the bid-ask spread a transaction cost?

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The bidask spread is the cost of trading immediately as opposed to ...View the full answer

Introduction To Derivatives And Risk Management

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