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Bond Assignment

Consider the T-Strip quotation attached.


1. Starting with the 2.15.2015 Strip, choose Strips that are roughly 6
months apart. So, the second one may 8.15.2015, and so on for the
next 30 years. For some years, you may not have enough
observations every 6 months, then choose strips that are one year
apart.
2. Find the YTM of these strips using the Asked price.
3. Draw the Yield Curve and explain its shape.
4. Using the above data, find the price of a T-bond maturing on
8.15.2015, with a coupon rate of 6.875% (assume semiannual interest
payment).
5. If the bond is selling for 140.4141 ($100 face value), is there any

mispricing?