主题2债券定价.pdf

Topic 2 FIXED E SECURITIES •Types of bond •Annuities • Bond pricing 11/09/2021 Copyright Laurence Copeland Topic 2 Page 1/ 17 PRELIMINARIES A bond is a long term (> 1 year) loan made by the owner of the bond to the issuing agency, in exchange for the promise of periodic interest (coupon) payments (usually every 6 months) and the return of the pr ipal on the redemption or maturity date. 11/09/2021 Copyright Laurence Copeland Topic 2 Page 2/ 17 Bonds issued by: - ernments: gilt-edged in UK, Treasury Bonds (T- Bonds) in USA, Bunds in Germany - Quasi- ernmental bodies (especially in USA e.g FNMA, GNMA etc) - Firms (corporate debt, debentures) usually at a price equal to the pr ipal or par value or face value (£100 or $1000). After issue (to primary market), bonds are traded in secondary market at prices reflecting their market value. 11/09/2021 Copyright Laurence Copeland Topic 2 Page 3/ 17 TYPES OF BOND ISSUED •Coupon bonds (straight debt) •Zero-coupon bonds (especially Treasury Bills, strips also compare preference shares) •Perpetuities (Consols by UK ernment, also PIB’s by UK building societies) •Convertibles (corporates) •Callable debt (US Federal ernment, US corporates) •Index-Linked (by ernments of Finland, Brazil, Israel, UK, Sweden, USA...) 11/09/2021 Copyright Laurence Copeland Topic 2 Page 4/ 17 Provisions of Bonds • Secured or unsecured • Call provision • Convertible provision • Put provision (putable bonds) • Floating rate bonds • Preferred Stock 11/09/2021 Copyright Laurence