You own a bond portfolio worth $41,000. You estimate that your portfolio has an average YTM...
You own a bond portfolio worth $41,000. You estimate that your portfolio has an average YTM of 6.3% and a Modified Duration of 11 years. If your portfolio's average YTM were to decrease by two basis points, what would be the approximate new value of your portfolio? Round to the nearest cent.
Homework Answers
New value of the portfolio=Value*(1-Modified Duration*change in YTM)=41000*(1-11*(-0.02%))=41090.20
Add Answer to:
You own a bond portfolio worth $41,000. You estimate that your
portfolio has an average YTM...
You own a bond portfolio worth $31,000. You estimate that your portfolio has an average YTM...
You own a bond portfolio worth $31,000. You estimate that your portfolio has an average YTM of 6.7% and a Modified Duration of 8 years. If your portfolio's average YTM were to decrease by 5 basis points, how much would the value of your portfolio change? Round to the nearest cent. [Hint: Answer is positive if the portfolio value increases and negative if the value decreases]
1.A You own a bond portfolio worth $70,000. You estimate that your portfolio has an average...
1.A You own a bond portfolio worth $70,000. You estimate that your portfolio has an average YTM of 5.0% and a Modified Duration of 20 years. If your portfolio's average YTM were to decrease by 2 basis points, how much would the value of your portfolio change? Round to the nearest cent. [Hint: Answer is positive if the portfolio value increases and negative if the value decreases] 1.B You estimate that a company's enterprise value is $200 million. If it...
Question 3 Homework. Unanswered You own a bond portfolio worth $51,000. You estimate that your portfolio...
Question 3 Homework. Unanswered You own a bond portfolio worth $51,000. You estimate that your portfolio has an average YTM of 5.9% and a Modified Duration of 14 years. If your portfolio's average YTM were to decrease by 4 basis points, how much would the value of your portfolio change? Round to the nearest cent. (Hint: Answer is positive if the portfolio value increases and negative if the value decreases] Numeric Answer: Unanswered 3 attempts left Submit Question 4 Homework....
Question 2 Homework. Unanswered A semi-annual coupon bond has MacD of 25.3 years, yield-to-maturity of 5.3%,...
Question 2 Homework. Unanswered A semi-annual coupon bond has MacD of 25.3 years, yield-to-maturity of 5.3%, and price of $1135.71. What is its DV01? Answer in dollars, rounded to three decimal places. Numeric Answer: Unanswered 3 attempts left Submit Question 3 Homework Unanswered You own a bond portfolio worth $51,000. You estimate that your portfolio has an average YTM of 5.9% and a Modified Duration of 14 years. If your portfolio's average YTM were to decrease by 4 basis points,...
You own a bond portfolio worth $217,913. The bonds have a weighted average duration of 10.1...
You own a bond portfolio worth $217,913. The bonds have a weighted average duration of 10.1 years If market rates rise by 46 basis points, by how much would the bond portfolio be expected to change in value? Be sure to include the correct sign and enter your result rounded to the nearest integer
You own a bond portfolio worth $393,353. The bonds have a weighted average duration of 16.5...
You own a bond portfolio worth $393,353. The bonds have a weighted average duration of 16.5 years. If market rates rise by 35 basis points, by how much would the bond portfolio be expected to change in value? Be sure to include the correct sign and enter your result rounded to the nearest integer.
Below is some useful material. A portfolio manager wants to estimate the interest rate risk of...
Below is some useful material.
A portfolio manager wants to estimate the interest rate risk of a bond using duration. The current price of the bond is 82. A valuation model found that if interest rates decline 30 basis points, the price will increase to 83.50 and if interest rates increase by 30 basis points, the price will decline to 80.75. What is the duration of this bond? [Read Attachment #1 before attempting.) Macaulay, Modified and Approximate Modified Durations Macaulay...
1. An annual coupon bond has a coupon rate of 5.4%, face value of $1,000, and...
1. An annual coupon bond has a coupon rate of 5.4%, face value of $1,000, and 4 years to maturity. If its yield to maturity is 5.4%, what is its Modified Duration? Round to three decimal places. 2. A semi-annual coupon bond has MacD of 23.6 years, yield-to-maturity of 6.6%, and price of $1071.43. What is its DV01? Answer in dollars, rounded to three decimal places. 3. You own a bond portfolio worth $31,000. You estimate that your portfolio has...
Problem 13-10 A university endowment fund has sought your advice on its fixed-income portfolio strategy. The...
Problem 13-10 A university endowment fund has sought your advice on its fixed-income portfolio strategy. The characteristics of the portfolio's current holdings are listed below: Bond A Credit Rating U.S. Govt. Maturity (yrs.) 3 Coupon Modified Rate(%) Duration Convexity 2.724 9.8 6.004 56.2 3.504 18.6 Market Value of Position $34,000 34,000 34,000 34,000 34,000 $170,000 10.909 128.8 a. Calculate the modified duration for this portfolio (le, Mod Do). Do not round Intermediate calculations. Round your answer to three decimal places...
What is the percent change in the value of a bond portfolio with a modified duration...
What is the percent change in the value of a bond portfolio with a modified duration of 8.25 years with a decrease in interest rates of 45 basis points?
Question 3 Homework. Unanswered You own a bond portfolio worth $51,000. You estimate that your portfolio has an average YTM of 5.9% and a Modified Duration of 14 years. If your portfolio's average YTM were to decrease by 4 basis points, how much would the value of your portfolio change? Round to the nearest cent. (Hint: Answer is positive if the portfolio value increases and negative if the value decreases] Numeric Answer: Unanswered 3 attempts left Submit Question 4 Homework....
Question 2 Homework. Unanswered A semi-annual coupon bond has MacD of 25.3 years, yield-to-maturity of 5.3%, and price of $1135.71. What is its DV01? Answer in dollars, rounded to three decimal places. Numeric Answer: Unanswered 3 attempts left Submit Question 3 Homework Unanswered You own a bond portfolio worth $51,000. You estimate that your portfolio has an average YTM of 5.9% and a Modified Duration of 14 years. If your portfolio's average YTM were to decrease by 4 basis points,...
You own a bond portfolio worth $217,913. The bonds have a weighted average duration of 10.1 years If market rates rise by 46 basis points, by how much would the bond portfolio be expected to change in value? Be sure to include the correct sign and enter your result rounded to the nearest integer
Below is some useful material.
A portfolio manager wants to estimate the interest rate risk of a bond using duration. The current price of the bond is 82. A valuation model found that if interest rates decline 30 basis points, the price will increase to 83.50 and if interest rates increase by 30 basis points, the price will decline to 80.75. What is the duration of this bond? [Read Attachment #1 before attempting.) Macaulay, Modified and Approximate Modified Durations Macaulay...
Problem 13-10 A university endowment fund has sought your advice on its fixed-income portfolio strategy. The characteristics of the portfolio's current holdings are listed below: Bond A Credit Rating U.S. Govt. Maturity (yrs.) 3 Coupon Modified Rate(%) Duration Convexity 2.724 9.8 6.004 56.2 3.504 18.6 Market Value of Position $34,000 34,000 34,000 34,000 34,000 $170,000 10.909 128.8 a. Calculate the modified duration for this portfolio (le, Mod Do). Do not round Intermediate calculations. Round your answer to three decimal places...
Most questions answered within 3 hours.
-
A building will require capital improvements of $1 million in
five years. Assuming monthly cash flow...
asked 42 seconds from now -
A $100,000 bond payable is issued on June 1, 20X1 at 106.
The bond comes due...
asked 4 minutes ago -
A 2.3 mm -diameter sphere is charged to -4.4 nC . An electron
fired directly at...
asked 7 minutes ago -
A rifle with a mass of 78 kg fires a bullet with a mass of 36...
asked 23 minutes ago -
Question 10
Applied Materials depreciates buildings and improvements over
useful lives of 5-50 years.
a.
True....
asked 43 minutes ago -
A 10.0 mL sample of 0.25 M NaOH(aq) is titrated with 40.0 mL of
0.10 M...
asked 44 minutes ago -
How
can we prove that a flow is incompressible if the velocity field is
known?
asked 46 minutes ago -
It is sometimes argued that understanding people's existing
activities does not really help to design future...
asked 50 minutes ago -
what is the angular velocity of tje moon in its orbut ( orbit
period is 28)?
asked 51 minutes ago -
Time Off At Superior Software Service
As she hangs up the telephone, Joan Jackson realizes that...
asked 54 minutes ago -
Use the sample data and confidence level given below to complete
parts (a) through (d).
A...
asked 56 minutes ago -
1. Consider a risky portfolio. The end-of-year cash flow derived
from the portfolio will be either...
asked 57 minutes ago