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I recently bought some bonds, but don't quite understand the data presented to me. First I will show you two images:

SUMMMARY: Summary

CHART: Chart

The SUMMARY shot shows MARKET COST: 93,300,000 with current price of 93.000 and BOOK COST is 99,871,311, thus my investment's total value has gone down.

However, in the CHART shot it shows that on the day the Buying was executed, which is 11 Nov 2015 the Price is 9.03 and the Price on 1 January 2016 is 9.111, which is an increase of +0.08.

My questions:

  1. Which one is the True current Price? 93.000 or 9.111? If one is True Price, what is the other?
  2. According to the CHART the value of this bonds has increased, yet according to the SUMMARY the value has gone down. What is going on actually?

Thank you very much

  • I have recently come to realized that the value presented in CHART is actually the Yield, though what the significance of that number is in relation to the value of my investment I have yet to learn. If anyone can teach me I would appreciate it. Thank you – rabbid Jan 1 '16 at 13:44
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In bonds yeald and price are inversely correlated. When the going yeald goes up the prices of existing bonds goes down. When the going yeald goes down then prices of existing bonds goes up.

You have what is called a 'paper loss'. It is not a real loss until and unless you sell your bond on the secondary market. But if you keep the bond unt maturity you icuurr no loss.

As near as I can tell, the coupon rate for your bond us 8.5%. That is a pretty good rate. If I were in your shoes I would ignore the current price of the bond I am holding and just hold it until maturity.

  • Thanks for your answer. Yes I read that yield has an inverse relationship to price. Interestingly I am holding two bonds. The one presented here does show that while its Price decreases its Yield increases. Yet, I have another bond that both Price AND Yield decreased! So that doesn't make sense to me... – rabbid Jan 2 '16 at 10:23
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The daily chart shows the last trade made on each day; unless yours was the last trade its value will be different. Specifically, you paid a higher price than the person who bought last on that same say. They are both right and you are currently in a loss position.

There is no true price; there is only the price of the most recent trade - the next trade will probably be around the same price but it could be hugely higher or lower.

  • Thanks for your answer. I understand of course in investing there is fluctuating price. I am referring specifically to two different numbers presented in SUMMARY and CHART. The value presented in SUMMARY is 93.3000, and the value presented in CHART is 9.111. My question was why the difference in value? I have recently come to realized that the value presented in CHART is actually the Yield, though what the significance of that number is in relation to the value of my investment I have yet to learn. If anyone can teach me I would appreciate it. Thank you. – rabbid Jan 1 '16 at 13:44

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