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The precise yield-to-maturities for 6 tradable zero-coupon U.S. treasuries are listed here: 30-year Bond 3.1% 25-year Bond 3.0% 20-year Bond 3.0% 15-year Bond 2.5% 10-year
The precise yield-to-maturities for 6 tradable zero-coupon U.S. treasuries are listed here: 30-year Bond 3.1% 25-year Bond 3.0% 20-year Bond 3.0% 15-year Bond 2.5% 10-year Note 2.5% 5-year Note 1.0% As a bond trader, you are given $100,000 to invest and seek to maximize the value of your investment in 10 years. You are free to invest in any of the 6 U.S. zero-coupon treasuries listed in the table above today, and may rebalance your portfolio once again in exactly 5 years. After this rebalancing, you must hold the portfolio for the remaining 5 years. You may assume the yield curve does not change over the entire 10 year investment period. Note this implies that in 5 years, the 30-year zero-coupon bond will be a 25-year zero-coupon bond with 3.0% yield-to-maturity, the 25-year zero-coupon bond will be a 20-year zero-coupon bond with 3.0% yield-to-maturity, the 20-year zero-coupon bond will be a 15-year bond with 2.5% yield-to- maturity, etc. What is the maximum possible value of your investment after 10 years? Please round your numerical answer to the nearest dollar
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