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YTM (Yield to Maturity) = Current Yield + Capital gain example Colin Capybara buys a bond immediately after a coupon is paid.. There are 13
YTM (Yield to Maturity) = Current Yield + Capital gain example Colin Capybara buys a bond immediately after a coupon is paid.. There are 13 annual coupons remaining. The coupon rate is 7% and it is priced to yield a 6% return.
a. What is the bond price today? b. What is the current yield if the bond? c. What is the price expected to be in one years time? d. Determine the expected capital gain? e. Add your answers from (b) and (d). What do you notice?
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