Question
A bond with 1 years left to maturity pays a semi-annual coupon rate of 7% a face value of $1000. The price of $981. The
A bond with 1 years left to maturity pays a semi-annual coupon rate of 7% a face value of $1000. The price of $981. The 6-month, 9-month, 12-month, 15-month and 18-month risk free rates are 7.4%, 7.75% and 8.25%, 8.5% and 8.6% p.a. respectively. What is the forward price for a contract on this bond that matures in fifteen months?
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Financial Theory and Corporate Policy
Authors: Thomas E. Copeland, J. Fred Weston, Kuldeep Shastri
4th edition
321127218, 978-0321179548, 321179544, 978-0321127211
