Which of the following steps is NOT used in the full valuation approach in measuring interest rate risk（）
A: Estimate hypothetical changes in required yields.
B: Calculate the bond’s convexity.
C: Recompute bond prices using the new required yields.
A: Estimate hypothetical changes in required yields.
B: Calculate the bond’s convexity.
C: Recompute bond prices using the new required yields.
举一反三
- An analyst does research about cost of common equity. With respect to calculating the cost of equity using the bond yield plus risk premium approach, which of the following statements about the risk premium is least accurate（） A: The risk premium compensates for the additional risk of equity compared with debt. B: We often estimate the risk premium using historical spreads between bond yields and stock yields. C: In developed country markets, a typical risk premium added is in the range of 2 to 4 percent.
- Which of the following is most appropriate for measuring a bond’s sensitivity to shaping risk?
- Effective duration is essential to measuring interest rate risk of a bond with an embedded call option because:
- A portfolio manager is considering the purchase of a bond with a 5.5% coupon rate that pays interest annually and matures in three years. If the required rate of return on the bond is 5%, the price of the bond per 100 of par value is closest to
- When we choose a higher interest rate as the discount rate for bond valuation, it causes the bond to sell for a discount. A: 正确 B: 错误