A coupon bond is paid on a regular schedule, either one, two, or four times a year. If you’re thinking about investing in a coupon bond, you can calculate the calendar date of the most recent coupon payment by using the COUPPCD function. If you’d like to know when the most recent coupon payment occurred, you can use the COUPPCD function.
- [Instructor] A coupon bond is paid on a regular schedule,…either one, two or four times a year.…If you're thinking about investing in a coupon bond,…you can calculate the calendar date…of the most recent coupon payment before your settlement…by using the COUPPCD function.…I'll show you how to perform that calculation in this movie.…And my sample file is PreviousCouponDate_04_06.…You can find that in the chapter four folder…of the exercise files collection.…Taking a look at the values in this worksheet,…you can see that to calculate the date…of the most recent past, previous coupon payment,…we need to know four different things.…
First is the settlement date…and that is the date that…you take possession of the security.…That's in C3.…Next is the maturity date…and that's the date the investment, usually a bond, ends.…That's in C4.…C5 is the number of coupons per year.…That can be one, two, or four,…for annual, semi-annual, or quarterly.…And finally basis is how Excel looks at the calendar.…I'll go into more detail on that when I create the formula.…
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- Recall what the type argument is used to determine when using the PMT function.
- Identify what the M stands for in the ACCRINTM function.
- Name the accounting rules used by the AMORDEGRC function to assign a depreciation coefficient to an asset.
- Recall what internal rate of return generated by the IRR function should be measured against to determine if it is a good investment.
- List the three regular intervals that coupon bonds pay interest at.
- Determine the function that provides a more conservative bond evaluation compared to the DURATION function.
- Explain what the RECEIVED function shows.
Skill Level Intermediate
1. Analyzing Loans, Payments, and Interest
2. Calculating Depreciation
3. Determining Values and Rates of Return
4. Calculating Bond Coupon Dates and Security Durations
5. Calculating Security Prices and Yields
6. Analyzing Simulation Results
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