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Classic Financial II manual · Chapter 9 of 16

Bonds

Find the price or yield of a bond and its accrued interest from its dates and coupon.

9.1Enter the bond#

Press 2NDBOND4 (BOND). The lines are: SDT settlement date, CPN annual coupon rate (percent), RDT redemption date, RV redemption value (100 at the start), a choice between ACT and 360 day counts, a choice between 2/Y and 1/Y coupons, then YLD (yield to maturity), PRI (price) and AI (accrued interest). Dates are typed as month.dayyear, for example 6.1224 for June 12, 2024.

The BOND worksheet opens at SDT. The display shows: SDT= 12-31-1990.
The BOND worksheet opens at SDT.
  1. 2NDBOND4
  2. SDT, CPN, RDT
  3. YLD ENTER
  4. PRI CPT
Pricing a bond.
Example 9.1

Day count and coupon choices

  1. Press 2ND ENTER on the day-count line to switch between ACT and 360.

    2NDBOND4↓↓↓↓2NDSETENTER
Result of the example "Day count and coupon choices" The display shows: 360.
You should see360
Example 9.2

Coupon frequency

  1. The line after the day count switches between 2/Y and 1/Y.

    2NDBOND4↓↓↓↓↓2NDSETENTER
Result of the example "Coupon frequency" The display shows: 1/Y.
You should see1/Y

9.2Find the price of a bond#

Enter the settlement date, coupon and redemption date. Type the yield you want in YLD and press ENTER. Then move ↓ to PRI and press CPT. AI, the accrued interest, is on the next line.

Example 9.3

Price at an 8% yield

  1. 6% coupon from 2024 to 2034 (settlement 1.0120, redemption 1.0130), yield 8, compute the price.

    2NDBOND41.0120ENTER↓6ENTER↓1.0130ENTER↓↓↓↓8ENTER↓CPT
Result of the example "Price at an 8% yield" The display shows: PRI= 86.41.
You should seePRI= 86.41
Example 9.4

Accrued interest

  1. Press down once more to read the accrued interest.

    2NDBOND41.0120ENTER↓6ENTER↓1.0130ENTER↓↓↓↓8ENTER↓CPT↓
Result of the example "Accrued interest" The display shows: AI= 0.00.
You should seeAI= 0.00
Example 9.5

Find the yield from a price

  1. Enter the price 86.4089 and compute the yield on the line above.

    2NDBOND41.0120ENTER↓6ENTER↓1.0130ENTER↓↓↓↓↓86.4089ENTER↑CPT
Result of the example "Find the yield from a price" The display shows: YLD= 8.00.
You should seeYLD= 8.00

See also Price of a bond

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