September 2023 IBM Bond Pricing All bonds have some common characteristics but they do not always have the same contractual features Differences
2024 Finance Bond Pricing due friday morning Assignment Help
IBM Bond Pricing All bonds have some common characteristics but they do not always have the same contractual features Differences 2023
IBM Bond Pricing. All bonds have some common characteristics, but they do not always have the same contractual features. Differences in contractual provisions, and in the underlying strength of the companies backing the bonds, lead to major differences in bonds risks, prices, and expected returns. It is important to understand how bond markets actually function and what the appropriate terminology is. Go to www.nyse.com Click on Products, and then click on Bonds on the right side of the window. In the window “Issuer name” type IBM. Click Go. In your initial response to the topic you have to answer all 5 questions. You are expected to make your own contribution in a main topic as well as respond with value added comments to at least two of your classmates as well as to your instructor. Copy the quotation of one IBM bond that contains the price “ Last Trade Price ”. Present these quotations in your posting. Describe the information that you received from the quote of the bond. You have to explain each number and symbol that appears in the bond quotation. Assume that par value of the bond is $1,000. What was the last price of the bond in $$$ (listed in Last Trade Price )? Assume that par value of the bond is $1,000. Calculate annual coupon interest payments. Assume that par value of the bond is $1,000. Calculate current yield of the bond. Assume that par value of the bond is $1,000. Assume annual coupon payments. Calculate YTM of the bond using the last price (listed in Last Trade Price ). (Round the number of years to the whole number). Show your work. Describe one major shortcoming for YTM and current yield. How would the following affect the yield on newly issued bond? Please explain your answer. a) The bonds are callable. b) The bonds are subordinated to the existing bond issue. c) The bond rating is better or worse than the Moody’s Aa3 that IBM anticipates.