Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Use Exhibit 20-5, Corporate Bond Quotation Table, to find the information for the corporate bond.
DUKE ENERGY FLA LLC
ask price in dollars $
Transcribed Image Text:**Exhibit 20-5: Corporate Bond Quotations from Fidelity.com**
This table presents a selection of corporate bond quotations, providing a comprehensive view of various bond details vital for market participants and analysts. Here's a breakdown of the key components in the table:
1. **Description**: Names and brief descriptions of the bonds, including the issuing corporation and specific notes or calls pertinent to the bond.
2. **Coupon**: The interest rate paid by the bond, expressed as a percentage of its face value.
3. **Maturity Date**: The date when the bond will mature, and the principal amount will be repaid to the bondholder.
4. **Next Call Date**: The earliest date the issuer may call, or redeem, the bond before its maturity date.
5. **Rating**: Evaluations of credit quality by Moody's and S&P:
- **Moody’s Rating**: Credit quality rating by Moody's Investors Service.
- **S&P Rating**: Credit quality rating by Standard & Poor's.
6. **Bid**: Details about the current price and yield at which investors are willing to purchase the bond.
- **Price**: Expressed as a percentage of the bond’s face value.
- **Qty (min)**: Quantity of bonds available at the bid price, with a minimum lot size.
7. **Ask**: Details about the current price and yield at which holders are willing to sell the bond.
- **Price**: Expressed as a percentage of the face value, typically higher than the bid price.
- **Qty (min)**: Quantity of bonds available at the ask price, with a minimum lot size.
8. **Yield to Worst/Yield to Sink**: The lowest yield potential for the bond under all possible redemption scenarios except for the issuer’s default. Yield to Sink applies if a sinking fund provision is present.
9. **Yield to Maturity**: The annualized return an investor can expect if the bond is held until it matures, assuming interest is reinvested at the same rate.
**Example Entry**:
- **BLACK HILLS CORP NOTE**:
- Coupon: 3.150%
- Maturity Date: 01/15/2027
- Next Call Date: 07/15/2026
- Ratings: Moody's BAA2, S&P BBB
- Bid: 92.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education