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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Chemical bond From Wikipedia‚ the free encyclopedia Jump to: navigation‚ search A chemical bond is an attraction between atoms that allows the formation of chemical substances that contain two or more atoms. The bond is caused by the electrostatic force of attraction between opposite charges‚ either between electrons and nuclei‚ or as the result of a dipole attraction. The strength of chemical bonds varies considerably; there are "strong bonds" such as covalent or ionic bonds and "weak bonds" such
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a net attractive force between the atoms ... a chemical bond. The two extreme cases of chemical bonds are: Covalent Bonds Covalent chemical bonds involve the sharing of a pair of valence electrons by two atoms‚ in contrast to the transfer of electrons in ionic bonds. Such bonds lead to stable molecules if they share electrons in such a way as to create a noble gas configuration for each atom. Hydrogen gas forms the simplest covalent bond in the diatomic hydrogen molecule. The halogens such as
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The characteristic of a convertible bond The convertible bond is one kind of equity-linked bonds. The term of the bond entitles bondholder to convert bonds into shares of the company or another company in the same group‚ at an agreed-upon conversion price‚ among a fixed period. The reason why it is made in this form is that the issuer can benefit from four aspects as follow‚ (1) better terms. A convertible bond have a lower interest rate‚ less restrictive covenants or the subordination of bondholders’
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Corporate Bonds‚ Common stock‚ and Preferred Stock Higher return means higher risk. People use excess money to invest in a corporation. It is a good way gain more money than put money into the saving account to get a little interest. Before you invest you should analyze the characteristics of corporate bonds‚ common stock‚ and preferred stock; and also be aware of their advantages and disadvantages. The corporate bonds are issued by corporations. They are used to increase capital for issuing
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Excerpt from FS Series #1: enabling sub-sovereign bond issuances B3. Case 3: Alternative Financing for Water Utilities — Lessons from a Failed Bond Issue in Indonesia B3a. Background and Environment PUBLIC INVESTMENT IN THE WATER SECTOR HAS BEEN VIRTUALLY ABSENT IN INDONESIA. ACHIEVING INDONESIA’S MILLENNIUM DEVELOPMENT GOAL‚ TO HALVE THE PROPORTION OF PEOPLE WITHOUT SUSTAINABLE ACCESS TO SAFE DRINKING WATER AND BASIC SANITATION BY 2015‚ WOULD REQUIRE A TENFOLD ANNUAL INCREASE IN INVESTMENTS
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Covalent Bonds Covalent bonds are formed when atoms share electrons‚ one from each atom in a single bond‚ to form electron pairs‚ usually making their outermost shells up to eight electrons by this means. This would make them more stable‚ less reactive and an electronic structure like a noble gas. They are most frequently formed between pairs of non-metallic elements. Non-metallic elements usually have from four to eight electrons in their outermost shells‚ the so-called valency electrons‚ which
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Rago October 3‚ 2014 Living on the Street Ann Petry’s novel‚ The Street ‚ was published in 1946. This riveting novel narrates the life of a single mother‚ Lutie Johnson‚ and her struggle of living in poverty on the streets of Harlem. Throughout this novel the theme of motherhood‚ or lack thereof‚ is very prevalent. However; the theme of motherhood does not capture my attention. What interests me is the underlying theme of the profound effect the “Street” has over its inhabitants. This theme captures my attention
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Eleventh Street was the longest‚ narrowest‚ and oldest street in the town. It had lots of potholes and rifts. Eleventh Street was a busy street where I spent most of my time. Both sides of the street were lined with stores and restaurants. There were many people walking on the street. There were a lot fun things to do‚ all within walking distance‚ and no matter what time the year‚ the stores were opened to the public‚ except on major holidays. Eleventh Street embodied to most of my childhood.
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HW Bond Valuation and Bond Yields Clifford Clark is a recent retiree who is interested in investing some of his savings in corporate bonds. His financial planner has suggested the following bonds: • Bond A has a 7% annual coupon‚ matures in 12 years‚ and has a $1000 face value. • Bond B has a 9% annual coupon‚ matures in 12 years‚ and has a $1000 face value. • Bond C has an 11% annual coupon‚ matures in 12 years‚ and has a $1000 face value. Each bond has a yield to maturity (YTM) of 9%
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