Advanced Bond Concepts
AAA
  1. Advanced Bond Concepts: Introduction
  2. Advanced Bond Concepts: Bond Type Specifics
  3. Advanced Bond Concepts: Bond Pricing
  4. Advanced Bond Concepts: Yield and Bond Price
  5. Advanced Bond Concepts: Term Structure of Interest Rates
  6. Advanced Bond Concepts: Duration
  7. Advanced Bond Concepts: Convexity
  8. Advanced Bond Concepts: Formula Cheat Sheet
  9. Advanced Bond Concepts: Conclusion

Advanced Bond Concepts: Introduction

By root

In their simplest form, bonds are pretty straightforward. After all, just about anyone can comprehend the borrowing and lending of money. However, like many securities, trading and analyzing bonds involves some more complicated underlying concepts.

The goal of this tutorial is to explain the more complex aspects of fixed-income securities. We'll reinforce and review bond fundamentals such as pricing and yield, explore the term structure of interest rates, and delve into the topics of duration and convexity. (Note: Although technically a bond is a fixed-income security with a maturity of ten years or more, in this tutorial we use the terms "bond" and "fixed-income security" interchangeably.)

The information and explanations in this tutorial assume that you have a basic understanding of fixed-income securities.

(If you feel you need a refresher, please see Bond Basics.)

Advanced Bond Concepts: Bond Type Specifics

  1. Advanced Bond Concepts: Introduction
  2. Advanced Bond Concepts: Bond Type Specifics
  3. Advanced Bond Concepts: Bond Pricing
  4. Advanced Bond Concepts: Yield and Bond Price
  5. Advanced Bond Concepts: Term Structure of Interest Rates
  6. Advanced Bond Concepts: Duration
  7. Advanced Bond Concepts: Convexity
  8. Advanced Bond Concepts: Formula Cheat Sheet
  9. Advanced Bond Concepts: Conclusion
RELATED TERMS
  1. Cape Cod Method

    A method used to calculate loss reserves that uses weights proportional ...
  2. Kenney Rule

    A ratio of an insurance company’s unearned premiums to its policyholders’ ...
  3. Discounted Future Earnings

    A method of valuation to estimate the value of a firm.
  4. Accelerated Return Note (ARN)

    A short- to medium-term debt instrument that offers a potentially ...
  5. Coupon Rate

    The yield paid by a fixed income security. A fixed income security's ...
  6. Coupon

    The interest rate stated on a bond when it's issued. The coupon ...
  1. How does a bond's coupon rate affect its price?

    Find out how a bond's coupon rate influences its price, including the role of government-dictated interest rates and the ...
  2. What is the difference between an option-adjusted spread and a Z-spread in reference ...

    Learn about the difference between the Z-spread and option-adjusted spread valuations of future cash flows for bonds, and ...
  3. In what ways can a sinking fund affect bond returns?

    Find out how a bond sinking fund provision impacts the likely returns on a corporate bond, and learn why investors should ...
  4. What are the benefits of using ceteris paribus assumptions in economics?

    Find out why mainstream economists rely on ceteris paribus assumptions in their models, even though they know those models ...

You May Also Like

Related Tutorials
  1. Fundamental Analysis

    Ethical Investing Tutorial

  2. Bonds & Fixed Income

    Investing For Safety and Income Tutorial

  3. Economics

    Macroeconomics

  4. Bonds & Fixed Income

    Certificates Of Deposit

  5. Investing Basics

    Capital Budgeting

Trading Center