Question
Suppose that you purchase a bond with a quoted price of $1,032.00 on January 15. The bond has a coupon rate of 5.820% and pays
Suppose that you purchase a bond with a quoted price of $1,032.00 on January 15. The bond has a coupon rate of 5.820% and pays interest on May 15 and November 15 of each year. The exact number of days between November 15 and January 15 is 61, and the exact number of days between November 15 and May 15 is 181.
What is the invoice price of the bond?
A bond has a par value of $1,000, a time to maturity of 10 years, and a coupon rate of 8.10% with interest paid annually. If the current market price is $810, what will be the approximate capital gain of this bond over the next year if its yield to maturity remains unchanged?
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