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An 8% coupon bond quoted price is $100.356. Its par value is $100. This bond pays semi-annual coupon payment. Suppose coupon payments are at the
An 8% coupon bond quoted price is $100.356. Its par value is $100. This bond pays semi-annual coupon payment.
Suppose coupon payments are at the end-June and end-December, and you are buying the bond at the end-May 2016.
Hence, the seller has "accrued" 5 out of the 6 months of the end-June coupon payment, and therefore is entitled to receive approximately 5/6 of the coupon.
Your invoice price (dirty price) is _______ ?
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