Bbb rated bond yields
[DOCX File]Quiz 3: Spring 1998 - New York University
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Assume that B&N is rated BBB, and that the default spread on BBB rated bonds is 2% over the treasury bond rate. Finally, the firm also had 300 million shares outstanding, trading at $ 10 per share. The stock has a beta of 1.25, the tax rate is 40% and the treasury bond rate is 5.5% (Market risk premium = 6.3%).
[DOC File]Chapter 10
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Those rated BBB or above (S&P, Fitch) or Baa and above (Moody’s) are considered investment grade bonds, while lower-rated bonds are classified as speculative grade or junk bonds. Convertible bond. Convertible bonds may be exchanged, at the bondholder’s …
[DOCX File]5
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The APT bond is rated BBB and will have a remaining term to maturity of 9 years when the Final Decision is implemented in July 2011. This credit rating and term to maturity is not consistent with the 10 year benchmark.) and the Bloomberg BBB 7 year fair value yield estimates, extrapolated to the benchmark 10 year term, to form its views on the DRP.
[DOC File]Chapter 3 Impact of Financing on Investment Decisions and ...
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8.3.4 To explain how credit migration may impact on bond values consider a bond which is currently rated as BBB. In a year’s time the bond may still be rated BBB, or it may have a higher or lower credit rating. The probability of being at the same or a different rating in …
[DOC File]Quantifying credit risk II: Debt valuation
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The practical import of changes in default rates for bond valuation can be seen in the typical EDF associated with companies rated BBB by Standard & Poor's over a five-year interval. A look again at Figure 1 shows that the differences over time are as large as a factor of four. (Figure 1 also shows median BBB spreads to LIBOR and Treasury rates.)
[DOC File]Chapter 11
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27. The bond equivalent yields for U.S. Treasury and A-rated corporate bonds with maturities of 93 and 175 days are given below: Bond Maturities 93 days 175 days. U.S. Treasury 8.07% 8.11%. A-rated corporate 8.42% 8.66%. Spread 0.35% 0.55%. a. What are the implied forward rates for both an 82-day Treasury and an 82-day A-rated bond beginning in ...
[DOC File]FIN350 In class work 4 First Name __________________ Last ...
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A) A Caa-rated bond. B) A Ca-rated bond. C) A C-rated bond. D) A Baa-rated bond. 5. The yield curve depicts the current relationship between: A) bond yields and default risk. B) bond maturity and bond ratings. C) bond yields and maturity. D) promised yields and default premiums. 6.
[DOC File]1
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A) A Caa-rated bond. B) A Ca-rated bond. C) A C-rated bond. D) A Baa-rated bond. 20. The yield curve depicts the current relationship between: A) bond yields and default risk. B) bond maturity and bond ratings. C) bond yields and maturity. D) promised yields and default premiums. 21.
[DOCX File]globip.com
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AAA-rated bonds show the highest risk with the negative 0.08 yield. AA-rated bonds have the negative yield of 0.07 and relatively low risk 0.05. A-rated bonds present slightly lower yield than AAA bonds but their risk is lower than AAA-rated bonds. BBB-rated bonds …
[DOC File]Review Questions
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BBB-rated corporate bonds are riskier than AAA-rated bonds. Explain where the two yield curves will lie relative to each other. What could cause the spread to widen? The yield curve for BBB-rated bonds would lie higher than the yield curve for AAA rated corporate bonds.
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