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You purchase a bond issued by XYZ Ltd, which is a 9% semi-annual coupon bond with a term to maturity of 12 years, and currently
You purchase a bond issued by XYZ Ltd, which is a 9% semi-annual coupon bond with a term to maturity of 12 years, and currently trading at par. 3 years later, immediately after receiving the 6th coupon payment, you sell the bond to your best friend. You best friends nominal yield to maturity is 7% per annum. Write down an equation that can be solved to find your total realised return over the 3-year holding period. (3 marks)
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