Provide the approximate quantities invested in every bond

Assignment Help Business Management
Reference no: EM131133027

You work for an insurance company. You have an obligation to pay $1 mln in exactly 1.5 years from today.

Your goal is to provide the company with an immunized portfolio that would hedge the current obligation. The company is only interested in first-order immunization, so you do not have to deal with convexity.

There are two bonds in the market:

the first bond has 1 year till maturity, pays 5% coupon rate and is traded at yield 4%.

The second one has 2 years to maturity, 3% coupon and is traded at yield 4%.

Assume all coupons are paid twice per year.

Please provide the approximate quantities invested in every bond (in thousand dollars). Assume one can buy fractions of bonds.

Reference no: EM131133027

Questions Cloud

Explain the end of the so-called golden age : What were some major economic and social problems that occurred in the West after 1973 that help explain the end of the so-called "Golden Age?"
Offer two alternative effects of these laws or cases : Write as if you are directly responding to the person that wrote the below assignment. APA. In text citation. Use their references. Although state and federal legislature have been passed laws to address and end human trafficking, their succes..
What do you attribute bonapartes appeal and success : Explain his effectiveness and or success as a ruler after 1799 or his appeal to his contemporaries and subsequent generations.
What extent did the french revolutionaries succeed : To what extent did the french revolutionaries succeed in their original goals? were the french more free before or as a result of their revolution? be specific.
Provide the approximate quantities invested in every bond : the first bond has 1 year till maturity - The second one has 2 years to maturity - provide the approximate quantities invested in every bond
What components constitution an electronic health record : What components constitution an electronic health record (EHR)? Why is it necessary for healthcare organizations to implement an EHR? What are the benefits of an EHR
What is the total value of the bank''s capital : Given your answers and the material in the text, why might recapitalization be a better policy than buying the troubled assets?
Goals that you would want to meet before you begin investing : Describe two financial goals that you would want to meet before you begin investing.- Explain why you would want to reach those goals first.
Explain the actions surrounding the event you described : Apply the ideas from the two theories you summarized to explain the actions surrounding the event you described. Describe how the theories helped you gain an understanding of child development

Reviews

Write a Review

Business Management Questions & Answers

  Arguments for and against getting an mbaimagine you are

arguments for and against getting an mbaimagine you are raising and countering objections regarding the decision to get

  Major theoretical approaches to knowledge managementcompare

major theoretical approaches to knowledge managementcompare and contrast the major theoretical approaches to knowledge

  Normal and lognormal random variable

this description of the demand for electricity is correct, what generating capacity must be available in order that the load be met 99.5 percent of the time?

  Identifying employee work conflicts with a gantt chart

Identify any work assignment conflicts along-with any assignments involved, the days that would be in conflict, the worker resources involved, and the workers I'll need.

  How do you define competitiveness and strategy

Based on your research, how would you define Operations Management? How do you define Competitiveness and Strategy? How does Productivity impact the entire organization? Explain how Forecasting is integral to every organization.

  What role should the company manager have

what role should the company manager have and after the data has been collected, how involved should the manager be in the techniques of data analysis?

  How does hrs role impact the organizations success

Explain what is HR's role in the performance appraisal process and how does HR'S role impact the organization's success

  Lewin and kotter models of change

In this week's reading we have learned about Lewin's and Kotter models of change. One of the Lewin's Model you discussed is unfreezing stage which is initiated through motivation

  What can hr and senior leadership

What can HR and senior leadership do to use power to move change levers and how can conflict be a powerful tool for organization change and growth?

  Performance reviews from several levels of management

Has anyone ever worked with a system that actually brings in several levels of management in order to minimize the possible bias resulting from bad leadership? How much does "politics" come into play in such cases?

  Write an agenda for a video conference to discuss all items

BSBADM405A - ORGANISE MEETINGS. Your job is to: Write an Agenda for a video conference to discuss all the items listed above. Include in your Agenda any other items that you believe XYZ P/Ltd would have on their Agenda

  Explaining data collection methods and analysis

The object of my critique is to describe how the study followed or failed to follow the criteria for good research. Data collection methods and analysis.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd