Bonds and Bond Yields
Lindsey Matthews
30 years: Risk management & derivatives trading
Lindsey begins his series by explaining what a bond is, why people invest in them and the factors you should consider when investing.
Lindsey begins his series by explaining what a bond is, why people invest in them and the factors you should consider when investing.
Bonds and Bond Yields
13 mins 29 secs
Rather than borrowing from a bank, large companies, banks and sovereign governments borrow money in the capital markets by issuing bonds. A bond is a security representing debt of an issuer. Bond buyers are the lenders; bond issuers owe lenders money and pay periodic interest to them. Interest payments a.k.a. coupons, are expressed as a percentage of the money borrowed. Key determinants of bond value are coupon, price and yield.
Key learning objectives:
What is a bond?
Why invest in Bonds?
Bond prices, cashflows and values
Yields, yield-to-maturity and the yield curve
Lindsey Matthews
09:04
06:10
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