If not stated, do we assume:
-semi-annual coupons
-face value=maturity value=100
??
I saw some slides say 1000, some say 100.作者: spartanag07 时间: 2011-7-11 17:40
it really doesnt matter.
just think of the price as % of face value (100 or 1,000 is your choice really if there is nothing in the exercise).
regarding the payment of coupons, unless otherwise stated, assume semi-annual.作者: Maddin 时间: 2011-7-11 17:40
But doesn't 2% semi-annual coupons at 100 face pays differently than 2% semi-annual coupons at 1000 face? :-O作者: rkapoor 时间: 2011-7-11 17:40
mbolzicco Wrote:
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> The coupon is a percentage of face. When the bond
> is priced at 98 you use the reference rate for
> face is 100. The same identical bond can be
> priced using 1000 as the reference rate for face,
> except quoted as 980.
>
>
> Both the bonds are trading at a discount. Both
> can offer a 2% coupon semi-annually. One will be
> a coupon of $2, the other a coupon of $20.
Sorry Matt. Gotta point out an slight mistake in your post. Bond prices are always quoted as a percentage of par. So a price quote of 98 doesn't necessarily mean that the face is 100.
You could have a bond with a par value of $5,000 which could be 'worth' $4,900, but it would still be 'quoted' at 98.作者: Bulla564 时间: 2011-7-11 17:40
bizzies4bankers Wrote:
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> i'd assume 1000 - even though I can't think of
> when it could negatively effect your answer. 1000
> or 100 is just a base point for the discount or
> premium figure...
eg: You have a bond paying 2%. What's Accumulated Value at t=1 of your coupons?
You'd assume semi-annual coupons and face=X
If face=100, that's $1/coupon
If face=1000, that's $10/coupon作者: Daniel1985 时间: 2011-7-11 17:40
i'd assume 1000 - even though I can't think of when it could negatively effect your answer. 1000 or 100 is just a base point for the discount or premium figure...
