标题: Bond Question [打印本页]

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作者: LiquidAssets10    时间: 2011-7-13 15:33     标题: Bond Question

Suppose a corporation issues bonds of say $100 with a flaoting rate coupon payable anually like
coupon rate = 5 year T note + 50 bps...
Maturity 10 years....
issued at say 1 Jan 2009 and will mature at 1 Jan 2019....
5 yr T note yield on 1 jan 2009 = 5%
5 yr T note yield on 1 july 2009 = 6%

So on 1st july 2009 there is coupon payment....
My question is whether the coupon payment will be $2.75 or $3.75.??.....that is the coupon is set at the beginning of the settlement period or at the end.....


Thanks in advance!

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作者: Penny-wenny    时间: 2011-7-13 15:33

Oh Yes....i meant semi anually....
thanks ElanG

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作者: shootingstar    时间: 2011-7-13 15:33

If it is set at the begining then why on July 1 it will be based on 6% rate it should be based on 5% rate right?why the ans is not 2.75%

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