BOND MARKET IN INDIA BONDS ARE INTEREST BEARING DEBT INSTUMENTS. In India Bonds are issued by Government of India‚ State Governments‚ and Corporate Sector. The different categories of Bond market in India are as follows: (a) Government and Agency Bond Market (b) Corporate Bond Market (c) Municipal Bond Market (d) Mortgage backed and collateral Debt Market (e) Funding Bond Market (A) Government and Agency Bond Market: A government Bond is a debt instrument issued by Government in the
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Arbitrage n Government Bond Market Case Facts: Samantha Thompson‚ who analyzed and traded government bond for the firm of Mercer and Associates‚ seems to believe that she has found an arbitrage opportunity in U.S government bond market in 1991. U.S government bond market is the largest‚ most liquid‚ and closely watched fixed-income markets in the world and hence finding an arbitrage opportunity there was unlikely. Mercers were active in repo markets and occasionally participated in bond arbitrage on its
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BONDS MARKET IN INDIA What are Bonds? A bond is a debt security in which the authorized issuer owes the holders a debt and‚ depending on the terms of the bond‚ is obliged to pay interest (the coupon) and/or to repay the principal at a later date‚ termed maturity. A bond is a formal contract to repay borrowed money with interest at fixed intervals. Thus a bond is like a loan: the issuer is the borrower (debtor)‚ the holder is the lender (creditor)‚ and the coupon is the interest. Bonds have a maturity
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BONDS Bonds pay fixed coupon (interest) payments at fixed intervals (usually every six months) and pay the par value at maturity. Par value = $1‚000 Coupon = 6.5% or par value per year‚ or $65 per year ($32.50 every six months). Maturity = 28 years (matures in 2032). Issued by AT&T. Types of Bonds Debentures - unsecured bonds. Subordinated debentures - unsecured “junior” debt. Mortgage bonds - secured bonds. Zeros - bonds that pay only par value at maturity; no coupons. Junk bonds - speculative or
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1)pk acquired a 25% interest in Trent Co. on January 1‚ 2010‚ for $500‚000. At that time‚ Trent had 1‚000‚000 shares of its $1 par common stock issued and outstanding. During 2010‚ Trent paid cash dividends of $160‚000 and thereafter declared and issued a 5% common stock dividend when the market value was $2 per share. Trent’s net income for 2010 was $360‚000. What is the balance in Agee’s investment account at the end of 2010 Cost $500‚000 Share of net income (.25 × $360‚000) 90‚000 Share
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VIETNAM BOND MARKET Nguyen Ngoc Anh Ministry of Finance – Vietnam 11/2009 A YOUNG AND GROWING MARKET • The Vietnam bond market development was boosted when Vietnam entered WTO in 2006. Total market capitalsisation is now at 15% of GDP. >500 government bonds outstanding on some USD 12 billion After 2008 foreign exodus the market today is predominantly Vietnamese with a handful of big players. In the absence of mutual funds and pension funds‚ banks dare key players. BOND GROWTH 2001-2008
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Chapter 9 Question #1 What characteristics define the money market? -Money market securities are short-term instruments with an original maturity of less than one year. These securities include Treasury Bills‚ commercial paper‚ federal funds‚ repurchase agreements‚ negotiable certificates of deposit‚ banker’s acceptances‚ and Eurodollars. Money market securities are used to “warehouse” funds until needed. The returns earned on these investments are low due to their low risk and high liquidity
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CHAPTER 7 Bonds Valuation CHAPTER ORIENTATION This chapter introduces the concepts that underlie asset valuation. We are specifically concerned with bonds. We also look at the concept of the bondholder’s expected rate of return on an investment. CHAPTER OUTLINE I. Types of bonds A. Debentures: unsecured long-term debt. B. Subordinated debentures: bonds that have a lower claim on assets in the event of liquidation than do other senior debtholders. C. Mortgage bonds: bonds secured
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……………………………………… Student ID: …………………………..…………….. AFIN 253 Financial Management MID-SEMESTER TEST: TUESDAY 10th APRIL 2012 Time allowed: 1 hour 30 minutes plus 10 minutes reading time. Instructions 1. Writing is not permitted in reading time. All pens‚ pencils and highlighters must be on your desk. 2. Part A - There are 15 multiple choice questions worth 1 mark each. Select the ’one best’ answer choice for each question. Answers to these must be recorded on a red-coloured General Purpose Answer
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You have been asked to write a training document about the US Bond Market for use in the new employee-training program. In your document‚ you must make sure to address each of the following: 1a: The key players in the market; and the types of investments available to both individual investors and institutional investors‚ Bond Characteristics A bond is a "security" which gives the holder a financial claim on the issuer. This claim protects the holder in circumstances in which the issuer is
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