
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text:6. Below is a list of daily Treasury note and bond listings from Wall Street Journal. Treasury
bonds make semiannual payments. First column is the maturity date. Second column is the
coupon rate. Third and Fourth columns show the bid and ask prices. Treasury prices are
quoted as a percentage of face value. So on the 2025/10/31 bond, the bid price is shown to be
106.212. With $1000 face value, this quote represents $1062.12. The Fifth column shows the
change in the ask price from the previous day, measured as percentage of face value. So the
2025/10/31 bond's ask price decreased by 0.002%, or $0.02 with face value of $1000, from
previous day's value. The last column shows the yield to maturity, based on the ask price.
Locate the Treasury bond in Figure 7.5 maturing in November 2026. Is this a premium or a
discount bond? What is its current yield? What is its yield to maturity? What is the bid-ask
spread in dollars? Assume a par value of $10,000.
Maturity
10/31/2025
11/15/2026
Coupon
3.000
6.500
Treasury Notes and Bonds
Bid
Asked
106.212
130.200
106.216
130.210
Chg
-0.002
-0.030
Asked Yield
1.814
1.821
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