In February 2009 Treasury 6s of 2026 offered a semiannually
In February 2009 Treasury 6s of 2026 offered a semiannually
1. In February 2009 Treasury 6s of 2026 offered a semiannually compounded yield of 3.5965%. Recognizing that coupons are paid semiannually, calculate the bond’s price.
2. Here are the prices of three bonds with 10-year maturities:
Bond Coupon (%) | Price (%) |
2 | 81.62 |
4 | 98.39 |
8 | 133.42 |
If coupons are paid annually, which bond offered the highest yield to maturity? Which had the lowest? Which bonds had the longest and shortest durations?