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Sorry, but i got another question 🙁
does spot yield curve is actually a YTM? i know that spot yield curve can be use to calculated MV of bond.
In example 3, the YTM is calculated eventhough the spot yield curve is given. But in example 5 the yield curve given is use as YTM. So i’m confuse on that part. Other than that, i almost understand this topic.The yield to maturity is the return demanded by investors. It is the ‘overall’ return per year over the entire life of the bond.
The spot yield curve gives the return demanded for each individual receipt over the life of the bond (which will change depending on the timing of each receipt). It is these rates that determine the market value of the bond and the overall return (the YTM) that the investor is getting.
ohh i see. So in example 5, it is actually a spot yield curve that were given in the statement and can be use to find MV of bond and after all that, finally YTM can be calculated right?
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