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Plz describe these terms i know some of them but not sure,
1- Par value
2- Nominal value
3- Coupon rate4-Gross redemption yield
5-Yield to maturityPar value and nominal value are the same thing – the amount ‘printed’ on the share/loan certificate (which need not be the amount paid for them).
The coupon rate is the interest rate that is paid on the nominal value.
The gross redemption yield is the overall interest to the investor taking into account not just the interest each year but also any premium payable on redemption.
The yield to maturity is the same thing as the gross redemption yield.All of the above are covered in our free lectures 🙂
i need a bit clarification about the “investor required rate” and gross redemption yield (GRY).
my understanding regarding this is that
-Required rate(yield) is the rate which is used for the discounting the cash flow(interest) for calculating the bond price.
-And Yield to maturity is the rate at which sum of p.v(interest plus principal) is equal to price of bond.
is it correct?
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