Question
You bought a 30-year, 6% coupon bond with a yield to maturity of 9%. If the YTM declined to 8%, which one statement is true:
You bought a 30-year, 6% coupon bond with a yield to maturity of 9%. If the YTM declined to 8%, which one statement is true:
A. You lost money because you were getting 9% interest and now are getting 8% interest.
B. The price increased
C. The price decreased
D. The coupons would adjust to $80 per year or $40 semi-annually.
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Introduces Quantitative Finance
Authors: Paul Wilmott
2nd edition
470319585, 470319581, 978-0470319581
