Calculating the Yield of a Zero Coupon Bond
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- Опубликовано: 12 апр 2015
- This video demonstrates how to calculate the yield-to-maturity of a zero-coupon bond. It also provides a formula that can be used to calculate the YTM of any zero-coupon bond.
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I always find myself coming back to Edspira. Thank you so much; you are a true legend!
OH MY GOD THANK YOU! YOU LITERALLY JUST SAVED MY LIFE BECAUSE THE BOOK MADE IT SO COMPLICATED AND YOU EXPLAINED SO SIMPLE.THANK YOU!
No problem. Glad to help!
Same here. Your video helped me refresh my memory since my corporate finance book explains it so much more complicated than my accounting textbooks :x
Thank you!!!
The way of explaining is very convincible! The first starts with very elementary math and then the continuation is just epic.
Thankuuu sir
For the concept clarification
❤❤❤
Great Video! The fact I actually asked myself what would happen if the zero bond would have a longer time to maturity…
thank you so much
I am having a problem when putting it into months. for example 16 months.
what if the yield was on 3 mth, with 67 days to maturity, how we calculate that
I think the n in the final equation would be 4, that is, 1 / .25 but remember the YTM is for a year not 3 months
What would the equation be if face value is the unknown. I can't remember how to solve for ^1/n. YTM +1=(FV/DISCOUNT)^1/n
In 1982 at of 10 I received 5k and talked my father into buying 10 year zero coupons that paid 12.99 %. I want to figure out thr discount on the 1000 dollar bonds.
Wouldn't it be the same if you take initial 5% rate divided that by the number of years ? Instead of making the whole new calculation.. just curious if it would be accurate
I was thinking the same thing. take the 5/3 = 1.6%
What happens if interest rates become negative ?How do you calculate the value of the Bond then ?
same thing
Sir how to find maturity in redeemable bond
this is increadibe
How would u calculate it If you were only given a par value, a current market rate, semi- annual compounding, and a 5 yr period?
I have a seperate video that explains this in more detail: ruclips.net/video/O2W935hzYpQ/видео.html. Your formula is: Zero Coupon Bond Value = F/(1+r)^t where r=market rate divided by 2 since it is paid semi-annually, and t=5x2 (10 payment periods since it is semi-annual). Also, a zero coupon bond is also known as a discount bond. I hope this helps. Good luck!
What if Vd is not given
How to calculate rate of return?
you should have more subs
worthless info unless you buy on the day of issuance. what happens when you buy on the secondary market 36 days after it was issued.
Eddie, I have an entire playlist called "chapter 14: long-term liabilities" (www.edspira.com/index-financial-accounting). It sounds like you were interested in the videos on amortizing a bond discount and premium. Best of luck in your studies!
@@Edspira where did the 1 come from on the equation?