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3 I recent past periods some yields on the sovereign debt of several European countries have turned negative. In effect, bond holders are paying these
3 I recent past periods some yields on the sovereign debt of several European countries have turned negative. In effect, bond holders are paying these governments for holding their capital. Data for late September 2019 were {term, yield}: ln f-1= mnBundYields ={{1,-0.0078},{2,-0.0076},{5,-0.007},{10,-0.0059},{30,-theta.0012}); A reasonable estimate for the yield curve can be found using a scond-order spline interpolation. Consider an older Bund with a 10 -year term, semi-annual payments, a face amount of e 10,000 and a coupon rate of 0.002%. The bond is 3 years into its term.What is the market price of bond given the above yields? Plz solve on Mathematica
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