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Suppose I own a zero coupon bond with one year to maturity. I believe that the issuer has a 20% probability of default and that
Suppose I own a zero coupon bond with one year to maturity. I believe that the issuer has a 20% probability of default and that the loss rate in the event of default is 40%. If the yield to maturity for this bond is 13%, what is my expected return?
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Heres how to calculate your expected return on the zerocoupon bond with default risk 1 Define Variab...
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Fundamentals of Investments Valuation and Management
Authors: Bradford D. Jordan, Thomas W. Miller
5th edition
978-007728329, 9780073382357, 0077283295, 73382353, 978-0077283292
