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Market interest rates are ( nominal ) 3 . 0 % . You just bought a bond, par $ 1 0 K , 5 y
Market interest rates are nominal You just bought a bond, par $Ky maturity, coupon
The moment after you bought it the Fed raised rates, and the market responded. Market interest rates instantly went to nominal
Bummer. When interest rates go up bond prices go down.
How much value did your bond lose? Compute the price you paid, and what it's worth after the rate change, and that's your loss. Report a $ loss as
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