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How can one determine the present value of a bond?
To determine the present value of a bond, you need to calculate the present value of its future cash flows, which include periodic interest payments and the bond's face value at maturity. This involves discounting these cash flows back to the present using an appropriate discount rate, typically the bond's yield to maturity. The sum of these discounted cash flows gives you the present value of the bond.
How can one determine the value of something?
One can determine the value of something by considering factors such as its utility, scarcity, demand, and market conditions. Additionally, comparing similar items and conducting research can help in determining its value.
What is use to determine the value of one currency against another?
The currency market.
Why is the price of a bond inversely related to the rate of interest?
A bond pays fixed (defined in the bond) cashflows at discrete points in the future. If interest rates are hight, these future fixed amounts are of lesser value in the present than when interest rates are low. For example, if I were to pay you $100 in one year and interest rates are 10%, then the value of the money, in today's value is $90.91. If interest rates were zero, then it would be worth $100 today. A bond's value is merely the sum of a whole bunch of examples like this.
What factors may cause a change in the market and fair value of fixed rate notes and bonds?
One of the key factors that can change the market and fair value of fixed rate notes and bonds is an increase or decrease in market interest rates. Even though a bond has a fixed rate, it's value is dependent on current yields in the market and the value of the bond will move inversely to interest rate changes.
How can one determine the coupon rate of a bond?
The coupon rate of a bond can be determined by dividing the annual interest payment by the bond's face value, and then expressing it as a percentage.
How can one determine the present value of a bond?
To determine the present value of a bond, you need to calculate the present value of its future cash flows, which include periodic interest payments and the bond's face value at maturity. This involves discounting these cash flows back to the present using an appropriate discount rate, typically the bond's yield to maturity. The sum of these discounted cash flows gives you the present value of the bond.
How do you get a savings bond?
Go to any bank with half the face value of the bond (a $100 bond costs you $50) and they will sell one to you.
What is the difference between bullet bond and Straight Bond?
"Bullet" means all of the principal (Face Value) is paid at maturity. This is the most common type and also referred to as a "Straight bond". An "Amortising bond" is one where the face value is paid back progressively over the life.
What does it mean when bonds are issued at a discount?
When a bond is issued at a discount, it is issued for a price less than par (face value). For example, if you were to purchase a bond with a face value of one thousand dollars for nine-hundred and eighty dollars, you bought the bonds at a discount because you purchased it for less than the bond will pay out at maturity. To calculate the 98, you would divide the purchase price by the par value.
What type of bond is sold below face value?
Many types of bonds may trade below face value. The reason for this is not based on the type of bond per se, but rather the conditions present in the marketplace. If a bond's coupon rate (the rate it pays its investors on a periodic basis) is below market interest rates for a bond of similar duration, the bond will trade at a discount to par (face value) since investors will have to be compensated in capital gains for what they will be missing out on yield if accepting the bond's coupon as opposed to market interest rates. (Bond prices and interest rates move opposite of one another. As market interest rates rise, the value of already issued bonds fall - sometimes below par value.)
How does one find out whether an old bearer bond has any value?
Examine the bond carefully. Some bonds have the value printed on them. If the bond has reached its full maturity, this is the value of your bond. If there is no value on it, you can take it to a bond specialist and have it appraised.
What is the face value of a coin?
The face value of a coin is however much money a coin can be spent as. A nickel's face value is 5 cents because it can only be spent as 5 cents.For example:The face value of a One Shilling coin is One Shilling.The face value of a One Dollar coin is One Dollar.The face value of any coin or bank note is what is written on it.
What is the face value of the 1977 dollar coin?
The FACE VALUE is One Dollar.
How are Savings bonds different from other bonds?
There are two kinds of bonds: coupon and zero-coupon bonds. A coupon bond pays interest on a periodic schedule--and what the schedule is depends on the bond. When you get the bond, it's got a certain number of coupons attached to it. Each one is dated and says how much interest you will receive when you redeem it. The main part of the bond is the corpus--the "body"--and when redeemed, you will receive the money you spent to buy the bond back. If you buy an investment-grade coupon bond, and its face value is $1,000, you need $1,000 to buy the bond. Note I said "investment-grade" here. If you buy a coupon bond that's in the junk category, quite often they sell at a discount from face value. But junk bonds are a world of their own. Savings bonds are zero-coupon bonds. They sell at a discount from face value--right now it's 50 percent, so if you want a $100 savings bond you need to bring $50. When the bond matures and is redeemed, you will receive the face value of the bond. There are no periodic interest payments with these bonds.
How can one determine the bond order of a molecule?
To determine the bond order of a molecule, you can count the total number of bonds between the atoms and divide by 2. The bond order indicates the strength of the bond between the atoms in the molecule.
How can one determine if a bond is polar or nonpolar without relying on electronegativity?
One can determine if a bond is polar or nonpolar by looking at the symmetry of the molecule. If the molecule is symmetrical and the atoms on either side of the bond are the same, the bond is likely nonpolar. If the molecule is asymmetrical or the atoms on either side of the bond are different, the bond is likely polar.
