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A bond issued by XYZ Corporation with a face value of $1,000 sells for $960, matures in five years, and has a 7% coupon rate
A bond issued by XYZ Corporation with a face value of $1,000 sells for $960, matures in five years, and has a 7% coupon rate with semiannual payments. An investor has a three years horizon and can reinvest coupons at an APR of 6%(with semiannual compounding) over this period. What is the annualized realized return for this investor if at the end of the three years the bond trades at a 7% yield to maturity?
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