Tag Bonds

Make-whole Call Provisions on the HP 10BII+

The article explains the concept of a "make-whole" call provision in bonds and demonstrates how to calculate the make-whole call price using the HP 10BII+ financial calculator. It contrasts the make-whole call with traditional calls, noting the benefits for investors and issuers. Using an example bond from PPG Industries, it details the calculation process through three methods: TVM keys, the NPV function, and the Bond functions of the calculator. Each method yields the same result, illustrating the present value of remaining cash flows and the call price.

Bond Valuation Using Microsoft Excel

A bond is a debt instrument, usually tradable, that represents a debt owed by the issuer to the owner of the bond. Most commonly, bonds are promises to pay a fixed rate of interest for a number of years, and then to repay the principal on the maturity date. In the U.S. bonds typically pay interest every six months (semi-annually),…

Make-Whole Call Provisions on the TI 84 Plus

In recent years, bond issuers have changed from the traditional call schedule to a “make-whole” type of call. Generally, this is good for investors as it makes it less likely that high interest bonds will be called. If it is called, then they are “made whole” because they are paid the present value of the remaining cash flows. In a…

Bond Valuation on the TI 84 Plus Calculator

How to Calculate Duration and Convexity of a Bond on the TI BAII Plus Professional

Duration and convexity are important numbers in bond portfolio management, but it is far from obvious how to calculate them on the TI BAII Plus Professional. Of course, there are formulas that you can type in (see table below), but they aren’t easy for most people to remember and are tedious to enter. In this article I will show you…

How to Calculate Duration and Convexity of a Bond on the TI BAII Plus

Duration and convexity are important numbers in bond portfolio management, but it is far from obvious how to calculate them on the TI BAII Plus. Of course, there are formulas that you can type in (see table below), but they aren’t easy for most people to remember and are tedious to enter. In this article I will show you how…

Make-whole Call Provisions on the TI BAII Plus

The article explains the concept of a "make-whole" call provision in bonds, highlighting its benefits for both investors and issuers. Unlike traditional call provisions that offer face value plus a small premium, make-whole calls ensure investors receive the present value of remaining cash flows, calculated using a discount rate tied to a comparable Treasury security. This provision provides issuers flexibility without paying a call premium. The article demonstrates three methods to calculate the make-whole price using a TI BAII Plus financial calculator, ensuring that investors are fairly compensated if the bond is called early.

Make-whole Call Provisions on the TI BAII Plus Pro

Bond Yield Calculation on the TI BAII Plus Pro Calculator

This article explains how to calculate the expected rate of return on bond investments using the TI BAII Plus Professional financial calculator. It covers three measures: current yield, yield to maturity (YTM), and yield to call (YTC). The tutorial provides step-by-step instructions for calculating these returns, emphasizing the use of the TVM keys and the BOND menu. The purpose is to help readers understand how to evaluate bond returns considering both income and potential capital gains or losses, aiding in making informed investment decisions.

Bond Yield Calculation on the TI BAII Plus Calculator

This article explains how to calculate the expected rate of return on bond investments using the TI BAII Plus financial calculator. It covers three measures: current yield, yield to maturity (YTM), and yield to call (YTC). The tutorial provides step-by-step instructions for calculating these returns, emphasizing the use of the TVM keys and the BOND menu. The purpose is to help readers understand how to evaluate bond returns considering both income and potential capital gains or losses, aiding in making informed investment decisions.

Bond Valuation on the TI BAII Plus Pro Calculator

This article explains how to use the TI BAII Plus Professional financial calculator to value bonds, focusing on both coupon payment dates and in-between dates. It covers bond cash flows, typically involving semiannual interest payments and principal repayment at maturity. The tutorial details calculating bond values using the calculator's TVM keys and BOND menu, emphasizing correct data entry for accurate valuations. The purpose is to teach readers how to determine a bond's present value based on expected future cash flows and appropriate discount rates, enhancing their understanding of bond valuation and related financial concepts.

Bond Valuation on the TI BAII Plus Calculator

This article explains how to use the TI BAII Plus financial calculator to value bonds, focusing on both coupon payment dates and in-between dates. It covers bond cash flows, typically involving semiannual interest payments and principal repayment at maturity. The tutorial details calculating bond values using the calculator's TVM keys and BOND menu, emphasizing correct data entry for accurate valuations. The purpose is to teach readers how to determine a bond's present value based on expected future cash flows and appropriate discount rates, enhancing their understanding of bond valuation and related financial concepts.