Last year tesla issued a bond with 8 year maturity, 5% coupon rate with semi annual coupon payments. Two semi annual coupon payments have already been paid. The bond can be called at price of 103 per 100 face value in 2 years(3 years at the time of the bond issuance). The bond is currently trading at 95 per 100 face value. What’s is the bonds yield to maturity? What’s the bonds yield to call? What’s the bonds yield to worst?
Debenture Valuation
A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.
Note Valuation
It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like:
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