Consider a bond trader that holds 5m of fixed rate bonds, Ask an Expert

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Consider a bond trader that holds $5M of fixed rate bonds with an annual coupon rate of 10% (paid semi-annually). The bond trader enters into a 5%/LIBOR swap as the fixed payer (notional principal $5M and semi-annual payments). What is the annual net effective interest rate the bond trader is receiving?

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Financial Management, Finance

Category:- Financial Management
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