Description

An introduction to bonds and the concept of yield to maturity. It includes calculating yields, valuing bonds, and working out profits made.

Learning Objectives

---

1. Identify the features of bonds and the terminology used by bond market practitioners.
2. Recall different coupon types.
3. Recall the concept of yield to maturity (YTM) and the inverse price-yield relationship.
4. Recall the YTM formula.
5. Differentiate between dirty and clean prices.
6. Determine how bond issuance pricing works and how to derive bond yields from secondary market prices.
7. Recall the concepts of carry and roll and yield curve fundamentals.