Question
Cupper Bhd. plans to issue RM5 million bonds with a coupon rate of 5%, a par value of RM100, annual coupon, 25 years maturity and
Cupper Bhd. plans to issue RM5 million bonds with a coupon rate of 5%, a par value of RM100, annual coupon, 25 years maturity and the call price of RM105. The bond is only callable after 2 years issued. The current market interest rate is 5%. There is an equal chance for the interest rate two years from now to be 4.0% and 5.5%.
What price are investors willing to pay for the bond?
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The Almanack Of Stanley Druckenmiller From Over 40 Years Of Investing Wisdom With Quantum Fund And Duquesne Capital Management
Authors: Rui Zhi Dong
1st Edition
B0B3NV2H9M, 979-8850611453
