Theoretical spot rates, Financial Management

The theoretical spot rates for treasury securities represent the appropriate set of interest rates that should be used to value the risk from default-free cash flows. A treasury yield curve can be used to construct the default free theoretical spot rate curve. Default-free theoretical spot rate curve can be built with the help of observed Treasury yield curve.

Though a number of approaches are in practice, but one prominent approach is bootstrapping.

Posted Date: 9/10/2012 2:14:53 AM | Location : United States







Related Discussions:- Theoretical spot rates, Assignment Help, Ask Question on Theoretical spot rates, Get Answer, Expert's Help, Theoretical spot rates Discussions

Write discussion on Theoretical spot rates
Your posts are moderated
Related Questions
Citilink will start a new business line on 1st July, 2011 to make and sell bus souvenirs. The target sales and production volume are 525,000 in next year. The following projected

A mortgage, is sold to the SPV at the discretion of the bank to securitize it into a mortgage backed security, that is, the mortgage is said to

What are the factors of debt securities A legal agreement, known as a trust deed, is drawn between security holders and company issuing the debt securities. Every security issu

After estimating the cash flows, the next step is to determine the appropriate interest rate that should be used to discount the cash flows. The minimum return re

nd held it until it matured, what annual rate of return would she have earned? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16

Why does money have time value? Positive interest rates point toward that money has time value.  When one person lets one more borrow money, the first person needs compensation

Why do analysts calculate financial ratios? Ratios are comparative measures.  For the reason that the ratios show relative value, they permit financial analysts to compare inf

undertake a critical review of the current academic literature to determine the reasons for benefits of and the costs to companies of cross listing.

Discuss the applicability of the operating cycle to poultry business in Uganda(consider broilers)

State the Significance of the Cost of Capital It must be recognized at the outset that cost of capital is one of the most difficult and disputed topics in the finance theory.