YouTube TI BA II+: How to compute bond price or yield when settlement date falls on coupon date (TIBA2-03)

Nicole Seaman

Director of CFA & FRM Operations
Staff member
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There are two ways to price a bond with the calculator: using the built-in bond worksheet, or using the time value of money (TVM) functions (i.e., N, I/Y, PV, PMT, and FV). This video shows you how to use the set of TVM to quickly find the price or yield of a bond. Notice that the approach is: input four, solve for the fifth. Maybe the most important first step is to simply decide on the length of each period, is it one year, six months (aka, semi-annual), quarterly, or daily? Then remember your output will solve in the same "periodicity." In general, we want to keep the defaults of P/Y = C/Y = 1. Finally, realize that you are implicitly using discounted cash flow (DCF) here, so the bond's returned price is the full (aka, cash) price, not its flat price.


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