Bond Yield Fill in data only within a red box

TODAY is Dec 8, 2021

Bond Price at Maturity $100.00
with a Coupon Rate of 10.00% value of each coupon is $10.00

You buy the Bond TODAY for $100.00 Years to Date of Sale is -16.78
Assume that you sell the Bond on Mar 2, 2005
You sell Bond for $80.00 A change of -20.0% in the Bond Price, namely 1.3% per year
F(y) = {PurchasePrice / MaturityPrice-CouponRate / y} (1+y)^n + CouponRate/y - SalePrice / Maturit

The Bond Yield is 12.98%

-5.0%
5.0
$553.11
Present Value of coupons = -$67.10 1.0%
4.0
Present Value of Sale Price = $620.21
PurchasePrice / Maturity Price pp = 1.000
3.0
SalePrice / MaturityPrice sp = 0.800 We're finding the yield by solving for y, from
Years n = -16.8 Err:502
2.0
Coupon Rate cr = 0.10000
F
y
)
(

1.0
F(y) = {1.00-0.10/y} (1+y)^-16.78+0.10/y -0.80

0.
%

%
%

%
5
%

0
1

2
-

-1.0
0
1
-

y=yield
 y =yield F(y) F '(x) cr = coupon rate = 0.100
-5.0% 4.295 -70.725 n = number of years = -16.8
1.1% 1.564 -26.947 sp = SalePrice/MaturityPrice = 0.800
6.9% 0.505 -11.882 pp = PurchasePrice/MaturityPrice = 1.000
11.1% 0.116 -6.959 Newton's Method for solving for y = Yield
12.8% 0.011 -5.730 See: http://home.golden.net/~pjponzo/n
13.0% 0.000 -5.611 f(x) = (pp-cr/y)*(1+y)^n +cr/y -sp = 0
d Price, namely 1.3% per year 13.0% 0.000 -5.609 f '(x) =(pp-cr/y)*n*(1+y)^(n-1)+cr/y^2*((1+y
e-CouponRate / y} (1+y)^n + CouponRate/y - SalePrice / MaturityPrice 13.0% 0.000 -5.609 Repeat y - F(y) / F '(y)
13.0% 0.000 -5.609
13.0% 0.000 -5.609
= start of Plot 13.0% 0.000 -5.609 See: http://home.golden.net/~pjponzo/bonds.htm
13.0% 0.000 -5.609
=Yield Increment 13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
We're finding the yield by solving for y, from 13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
13.0% 0.000 -5.609
on rate = 0.100 yy = yield F(y)
er of years = -16.8 -5.0% 4.295
Price/MaturityPrice = 0.800 -4.0% 3.643
hasePrice/MaturityPrice = 1.000 -3.0% 3.091
s Method for solving for y = Yield -2.0% 2.621
://home.golden.net/~pjponzo/newton_explain.htm
-1.0% 2.221
cr/y)*(1+y)^n +cr/y -sp = 0 0.0% 1.878
cr/y)*n*(1+y)^(n-1)+cr/y^2*((1+y)^n-1) 1.0% 1.584
- F(y) / F '(y) 2.0% 1.331
3.0% 1.112
4.0% 0.923
home.golden.net/~pjponzo/bonds.htm 5.0% 0.759
6.0% 0.616
7.0% 0.491
8.0% 0.381
9.0% 0.285
10.0% 0.200
11.0% 0.125
12.0% 0.058
13.0% -0.001
14.0% -0.054
15.0% -0.101
16.0% -0.144
17.0% -0.182
18.0% -0.217