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Imagine you purchased an Apple $1000 face value bond at the end of 2008 when its yield to maturity was 4%. This bond was issued in 2007 and has a...
Imagine you purchased an Apple $1000 face value bond at the end of 2008 when its yield to maturity was 4%. This bond was issued in 2007 and has a fixed annual coupon rate of 4.5% and matures at the end of 2020. Currently it is the end of 2019 and it has a yield to maturity of 5% and you want to sell this bond. What price did you buy the bond at and what price will you sell it at today? What would be your holding period return?