A 10 coupon bond with a june 20 2025 maturity has a market, Ask an Expert

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A 10% coupon bond with a June 20, 2025 maturity has a market price of 101. Suppose that today is Feb. 20, 2017.

What is the bond's YTM? (to within $0.20)

a. If coupons can be reinvested at the YTM, what is the holding period return if the bond is held to maturity?

b. If coupons can be reinvested at 6%, what is the (annualized) holding period return if the bond is held to maturity?

here is the solution from my professor, but I have no idea how to count the days and how to trial the rate, he told us do not use regular formula to do the YTM or get zero grage. can you explain the reasons and more details from the way my professor did?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92748688

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