Questions tagged [bond-coupons]

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8
votes
3answers
759 views

Are negative coupon bonds possible?

I am aware that negative yield bonds are possible (e.g. by selling a zero coupon bond at a price greater than par value). Are negative coupon bonds possible? I have not found any real-life examples of ...
0
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0answers
22 views

Choosing between a deep discount bond and a loan with variable interest rate

I was wondering what kind of a method should be used to choose between a deep discount bond and a loan with variable interest. Since one option has a fixed rate, and the other has a variable interest ...
1
vote
1answer
49 views

Coupon payment intervals in bond names

Consider the name of a bond: "American Telephone & Telegraph Co. Convertible 4½s, due 1933"†. I have some questions about the coupon payment interval information contained in the name: ...
0
votes
1answer
197 views

Given two similar bonds, is the one with a higher yield to maturity (YTM) always a better investment?

Consider two bonds that have the same issuer, seniority, credit rating, and maturity date. My question is about the comparability of their yield to maturity (YTM): if one bond has a higher YTM the ...
0
votes
1answer
124 views

An investor holding an 8% subordinated debenture will receive how much at maturity?

I came across this question in the Wiley Series 7 2020 book: An investor holding an 8% subordinated debenture will receive how much at maturity? a. $1,000 b. $1,080 c. $1,040 d. Depends on the ...
0
votes
2answers
142 views

How do I find the present value of a bond by discounting each cash flow at a different rate?

Suppose I have a $100 par value bond that pays $6 in coupons semi-anually (i.e. $3 every 6 months). The bond matures in 2 years. There will be a total of 4 cash flows, so the present value calculation ...
1
vote
1answer
84 views

Net Bond Coupon/Yield

I just wondered on how one can properly get the Net Bond Yield/Coupon given that you had some "trading" that happened. Suppose, I have a group of bonds (say some Treasury bonds). I acquired a 100 Par ...
11
votes
2answers
2k views

Do bonds become more valuable right before a coupon payment?

I'm learning about fixed income for the first time and my understanding is that the value of a bond depends on three major variables: The face value The time to maturity The coupon rate a.k.a. the ...
0
votes
1answer
86 views

Moneyfarm (ETF) and Coupons

I am a beginner, I have possessed public debt bonds only, so far. Recently I decided to differentiate my savings on some form of ETF, specifically on Moneyfarm, just to give it a try. Now, I am trying ...
1
vote
1answer
311 views

Coupon Payment Date

For a bond that pays interest semi-annually, is a must for a coupon payment date to fall on exactly the same day? For instance, if the bond matures in June 30, 2025, the coupon payment dates shall be ...
-1
votes
1answer
160 views

If bond yields fall by 1% across all maturities, which of the following bonds will increase in value the most?

10% coupon bond with 15 years to maturity 5% coupon bond with 15 years to maturity 10% coupon bond with 20 years to maturity 5% coupon bond with 20 years to maturity
0
votes
1answer
615 views

Does par value include interest?

Is it only the principal amount, original cost of the bond at the end of maturity date or does it include the whole sum with the interest payments?
1
vote
1answer
928 views

compute the price of a 90-day zero coupon bond with a face value of $100 if the market yield is 6 percent

This is a question from a textbook: compute the price of a 90-day zero coupon bond with a face value of $100 if the market yield is 6 percent Unless indicated otherwise, assume that 1 year = 365 days,...
2
votes
0answers
172 views

Question Regarding Bond-Coupon Prices with Partial Period Maturity Date

Question: What would you pay for the following bonds assuming an annual yield rate of 7% based on semi-annual compounding (assume face value = $100)? A bond with a coupon rate of 6% maturing in 3 ...
1
vote
3answers
993 views

When short negative yielding bonds, who pays the coupon

Assuming the bond was actually issued with a negative coupon, if you are short (borrowing someone else's bond to sell the bond at a lower price / higher yield) Who pays the coupon? There are at ...
12
votes
1answer
3k views

200%+ return in 10 years from…bonds?

I read an article this morning about a million dollar bet Warren Buffett made with a hedge fund that would take 10 years to determine the outcome. They didn't each put down a million dollars, rather, ...
3
votes
5answers
201 views

Is the need to issue bonds a telltale sign that the company would have a hard time paying coupons?

Background I'm trying to solidify my understanding of bonds, and I have a question regarding something that's probably very basic. Question Say I have a company and I want to issue some bonds in ...
3
votes
2answers
220 views

Could someone help me understand bond information?

I'm currently looking at this website for information on Government of Canada bonds. I was just wondering if anyone could tell me when the coupon payments are made (is there only one at maturity?) and ...
3
votes
1answer
221 views

If a bond has a par value of 1000 and a monthly coupon rate of 3.650%, do I get $36.5 every month until maturity?

I'm looking at bond with CUSIP DSDB66702, which has a monthly coupon rate of 3.650 and a par value of $1000. If I hold this to maturity will I get $36.50 every month before taxes?
1
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2answers
234 views

Liquidity of U.S. treasury bonds and moving in and out of them before maturity?

I am curious about the liquidity of U.S. treasury bonds. I always hear about how liquid they are. I like the rates of the 30 year treasury bonds but lets say I don't want to park money for 30 years. ...