Under MSRB rules, which of the following municipal bonds would be quoted on a yield-to-call basis on ...

By Investopedia Staff AAA
Q:
Under MSRB rules, which of the following municipal bonds would be quoted on a yield-to-call basis on the customer’s confirmation?

a) State of Illinois 4.50s of 2021 trading @ 4.55
b) City of Bonder 6s of 2014 trading @ of 5.20
c) Morgan County 5s of 2009 trading @ 6.15
d) City of Nokomo 5.10s of 2020 trading @5.20

A:

The correct answer is b.
MSRB rules require that the customer confirmation show the lowest potential yield. In a bond trading at a premium, this would, of course, be the yield-to-call. Only the bond in choice “A,” is trading at a premium, the others are trading at a discount.


RELATED FAQS

  1. You are analyzing a small company's financials, and notice that the bookkeeper made ...

    The best answer is 2. 1 is tempting, but wrong, because an asset "sounds like" a debit but the depreciation expense here ...
  2. Which of the following statements is (are) true with respect to the key characteristics ...

    The correct answer is: a) (I) is incorrect. The rule is that if the Standards are more strict than local laws, yet they are ...
  3. A company issues some shares in order to finance the purchase of some more production ...

    The correct answer is: a) This transaction will increase the assets of the company and its equity by the same amount. Hence, ...
  4. Which one of the following uses of the "CFA" trademark is correct ...

    The correct answer is e. The correct use the CFA abbreviation is one the most important things to know as a CFA candidate. ...
RELATED TERMS
  1. Series 79

    A examination to ensure a candidate is qualified to become a ...
  2. Research Analyst

    A person who prepares investigative reports on equity securities. ...
  3. Series 34

    An exam required for individuals seeking to engage in off-exchange ...
  4. Financial Advisor

    One who provides financial advice or guidance to customers for ...
  5. Series 23

    An exam offered by the Financial Industry Regulatory Authority ...
  6. Series 28

    An exam given by the Financial Industry Regulatory Authority ...

You May Also Like

Related Articles
  1. Insurance

    Municipal Bond Tips For The Series 7 ...

  2. Retirement

    6 Proven Tips For Series 6 Success

  3. Insurance

    Tips For Passing The Series 6 Exam

  4. Professionals

    Banker Or Broker: Which Career Is Right ...

  5. Professionals

    Breaking Down Financial Securities Licenses

Trading Center