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Today is 1 July, 2019. Yasmine has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and
Today is 1 July, 2019. Yasmine has a portfolio which consists of two different types of financial instruments (henceforth referred to as instrument A and instrument B). Yasmine purchased all instruments on 1 July 2012 to create this portfolio, which is composed of 39 units of instrument A and 30 units of instrument B.Instrument A is a zero-coupon bond with a face value of $100. This bond matures at par. Its maturity date is 1 January 2029.
Instrument B is a Treasury bond with a coupon rate of j2 = 3.75% p.a. and a face value of $100. This bond matures at par. Its maturity date is 1 January 2022.
Calculate the current price of instrument B per $100 face value. Round your answer to four decimal places. Assume the yield rate is j2 = 4.99% p.a. and Hlne has just received her coupon payment.
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