A bond with a duration of 6.7 has a current price of $1138.29, and its yield...
A bond with a duration of 6.7 has a current price of $1138.29, and its yield to maturity is 7.58%. If the yield to maturity changes to 7.32%, you would predict that the new value of the bond will be
Homework Answers
We see that the new value of the bond will be given as equal to=1138.29*(1-(6.7/1.0758*(7.32%-7.58%))=1156.72
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A bond with a duration of 6.7 has a current price of $1138.29,
and its yield...
Assume a bond has modified duration of 6 and convexity of 200. Its price at yield...
Assume a bond has modified duration of 6 and convexity of 200. Its price at yield to maturity of 8% is $98.5 for par value of $100. What will be its new price if interest rate increase by a) 100 bps b) 10 bps c) 1 bps 2. Using duration only adjustment and using both duration and convexity adjustment. What is the significance of convexity adjustment as changes in interest rate decrease?
A bond with a 9-year duration is worth $1,080, and its yield to maturity is 8...
A bond with a 9-year duration is worth $1,080, and its yield to maturity is 8 %. If the yield to maturity falls to 7.84% , you would predict that the new value of the bond will be approximately $1,035 $1,036 $1,094 $1,124
A bond with a 7-year duration is worth $1,085, and its yield to maturity is 8.5%....
A bond with a 7-year duration is worth $1,085, and its yield to maturity is 8.5%. If the yield to maturity falls to 8.29%, you would predict that the new value of the bond will be approximately _________. Multiple Choice $1,082.72 $1,085.00 $1,099.65 $1,087.28
Duration of bond ABC is 6.67 years and its convexity is 135. If that bond has...
Duration of bond ABC is 6.67 years and its convexity is 135. If that bond has current price of 107, yield to maturity of 5% and if yields decrease by 1.25%, what would be the new price of this bond? Explain.
1) 2) A bond with a 7-year duration is worth $1,076, and its yield to maturity...
1)
2)
A bond with a 7-year duration is worth $1,076, and its yield to maturity is 7.6%. If the yield to maturity falls to 7.48%, you would predict that the new value of the bond will be approximately You have purchased a guaranteed investment contract (GIC) from an insurance firm that promises to pay you a 7% compound rate of return per year for 6 years. If you pay $15,000 for the GIC today and receive no interest along...
A bond has a current price of $1,030. The yield on the bond is 8%. If...
A bond has a current price of $1,030. The yield on the bond is 8%. If the yield changes from 8% to 8.1%, the price of the bond will go down to $1,025.88. The modified duration of this bond is __________.
A bond is currently selling at $1,025.5, has a yield-to-maturity of 6.46%, and has a duration...
A bond is currently selling at $1,025.5, has a yield-to-maturity of 6.46%, and has a duration of 8. If the yield-to-maturity rises to 6.86%, calculate the new price of the bond.
You manage a bond portfolio with a current value of $150,000,000 & a duration of 7.32....
You manage a bond portfolio with a current value of $150,000,000 & a duration of 7.32. You need to hedge the interest rate risk of this portfolio for some reason. Today's date is Monday 12/10/2018, so the settlement price for a treasury bond is the 11th. You decide to use the 10 year t-note futures to hedge. The cheapest to deliver bond is the 3 percent coupon bond with maturity date of 09/30/2025 which is currently selling for a yield...
7.) The yield to maturity of a $ 1,000 bond with a 6.7 % coupon rate,...
7.) The yield to maturity of a $ 1,000 bond with a 6.7 % coupon rate, semiannual coupons, and two years to maturity is 7.7 % APR, compounded semiannually. What is its price? The price of the bond is $ __ 8.) Suppose a ten-year, $ 1 comma 000 bond with an 8.4 % coupon rate and semiannual coupons is trading for $ 1 comma 035.89. a. What is the bond's yield to maturity (expressed as an APR with semiannual...
11. A bond makes annual coupon payments, is currently worth $995, and has a duration of...
11. A bond makes annual coupon payments, is currently worth $995, and has a duration of 4.77 years. The bond's yield-to-maturity is currently 9%. If the rate on same-risk bonds suddenly changes to 8.52%, then what does duration predict the new price of the bond to be? Round your answer to the nearest penny.
Assume a bond has modified duration of 6 and convexity of 200. Its price at yield to maturity of 8% is $98.5 for par value of $100. What will be its new price if interest rate increase by a) 100 bps b) 10 bps c) 1 bps 2. Using duration only adjustment and using both duration and convexity adjustment. What is the significance of convexity adjustment as changes in interest rate decrease?
A bond with a 9-year duration is worth $1,080, and its yield to maturity is 8 %. If the yield to maturity falls to 7.84% , you would predict that the new value of the bond will be approximately $1,035 $1,036 $1,094 $1,124
1)
2)
A bond with a 7-year duration is worth $1,076, and its yield to maturity is 7.6%. If the yield to maturity falls to 7.48%, you would predict that the new value of the bond will be approximately You have purchased a guaranteed investment contract (GIC) from an insurance firm that promises to pay you a 7% compound rate of return per year for 6 years. If you pay $15,000 for the GIC today and receive no interest along...
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