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Definition of 'Static Spread'
The constant yield spread which when added to the point on the spot rate Treasury curve where a cash flow from a bond is received will make the price of the bond equal to the present value of its cash flows. In other words, each cash flow is discounted at the appropriate Treasury spot rate plus the static spread. The static spread is also known as a zero-volatility or Z-spread.
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Investopedia explains 'Static Spread'
Static or Z-spread calculations are frequently used in mortgage-backed securities and other bonds with embedded options valuation. An option adjusted spread calculation, which is frequently used to value bonds with embedded options, is essentially a static spread calculation based on multiple interest rate paths and the prepayment rates associated with each interest rate path.
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Search results for 'Static Spread'
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http://stocks.investopedia.com/stock-analysis/2011/Severe-Static-For-Telco-Suppliers-JDSU-FNSR-CIEN-GLW-OPXT0311.aspx
... Severe Static For Telco Suppliers. ... like JDS Uniphase (Nasdaq:JDSU), Finisar
(Nasdaq:FNSR) and Ciena (Nasdaq:CIEN) on the idea that the spread of smartphones ...
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http://www.investopedia.com/exam-guide/cfa-level-1/alternative-investments/hedge-fund-basics.asp
... International Finance; 5.8 Purchasing Power Parity and Interest Rate Parity;
5.9 Foreign Exchange; 5.10 Spread Calculations; 5.11 Spot ...
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http://www.investopedia.com/exam-guide/series-7/portfolio-management/capital-market-line.asp
... 8.10 Option Styles; 8.11 Spread Option Strategies; 8.12 Straddle Option Strategies; ...
Figure 12.1 illustrates: how a static, risk-free investment should yield the ...
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http://www.investopedia.com/articles/stocks/07/style-investing.asp
... Finally, style classes are not static. A large cap value or small cap growth stock
doesn't stay that way forever. ... Spread Out Risk With Sector-Based ETFs. ...
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http://www.investopedia.com/exam-guide/cfa-level-1/portfolio-management/capital-market-theory.asp
... International Finance; 5.8 Purchasing Power Parity and Interest Rate Parity;
5.9 Foreign Exchange; 5.10 Spread Calculations; 5.11 Spot ...
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