Question
R's 9% coupon is paid once per year. The bond's yield to maturity is 12% and its duration is 15 years. What will be the
R's 9% coupon is paid once per year. The bond's yield to maturity is 12% and its duration is 15 years. What will be the percentage change in bond R's price if its yield to maturity increases by 20 basis points?
when using the formula of -(1/1 + i) x D x i
i = 12.2 or 0.122 > d = 15
the answer is -2.68 but when I calculate it I get 2.94! What am I doing wrong
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Modern Portfolio Theory and Investment Analysis
Authors: Edwin Elton, Martin Gruber, Stephen Brown, William Goetzmann
9th edition
9781118805800, 1118469941, 1118805801, 978-1118469941
