Example: Computing Bond Price And Accrued Interest - Texas Instruments BA II PLUS User Manual

Example: Computing Bond Price and Accrued
Interest
You consider buying a semiannual corporate bond maturing on
December 31, 2007 and settling on June 12, 2006. The bond is based on
the 30/360 day-count method with a coupon rate of 7%, redeemable at
100% of par value. For an 8% yield to maturity, compute the bond's price
and accrued interest, accrued interest, and modified duration.
Computing Bond Price and Accrued Interest
To
Select Bond worksheet.
Enter settlement date.
Enter coupon rate.
Enter redemption date.
Leave redemption value as is.
Select 30/360 day-count
method.
Leave two coupon payments
per year.
Enter yield.
Compute price
View modified duration
The bond price is $98.56 per 100. The accrued interest is $3.15
Answer:
per 100.
56
Press
& l
!
6.1206
# !
7
# ! RDT =
12.3107
#
# & V
#
# !
8
# %
#
Display
SDT = 12-31-1990
SDT =
6-12-2006
CPN =
12-31-2007
RV =
100.00
360
2/Y
YLD =
PRI =
98.56
DUR =
Bond Worksheet


7.00


8.00

1.44