标题: YTM zero coupon bond [打印本页] 作者: brk1yn 时间: 2011-7-11 20:05 标题: YTM zero coupon bond
are zero coupon bonds compounded semiannually or annually? If YTM of a 10 year zero coupon bond is 8 percent should we use 4 as I/Y and 20 as N? or 8 as I/Y and 10 as N?作者: JPSem 时间: 2011-7-11 20:05
Despite the fact that they are zero-coupon bonds, standard practice is to calculate their price assuming semi-annual compounding. So you are correct using i=4% and N=20.作者: MonkeyBusiness 时间: 2011-7-11 20:05
If I am not wrong, you have to assume semi-annual compounding for CFA exams unless stated explicitly.
US bonds are compounded semi-annual and EUR bonds annually.
