Treasury bills are popular investments, as are bonds. If you want to compare a T-bill’s yield to a bond’s yield, you can do so using the TBILLEQ function. T-bills and bonds might seem like equivalent investments, but they’re not. You can compare those two types of investments by converting a T-bill yield to a bond yield using the TBILLEQ function.
- [Voiceover] Treasury bills are…a popular investments, as are bonds.…If you want to compare a T-bill's yield…to a bond's yield, you can do so…using the TBILLEQ Function.…I'll show you how to perform that calculation…in this movie using the BondEquivalentYield_05_07…sample file which you can find in the Chapter 5 folder…of the Exercise Files collection.…One bit of vocabulary before we go any further.…The first is that a T-bill lasts less than one year.…In other words, if you have a treasury investment…that will be paid off within six months,…then that is a bill.…
On the other hand, your investment lasts longer…than one year, such as the popular 10-year or 30-year bonds…then that is called a bond.…So again, a bill, less than a year,…a bond, greater than a year.…Let's check the bond equivalent yield…for the following security.…We've got a Settlement data, the date…that you take possession of the security.…That's in C3.…Maturity data is the date that the T-bill is paid off.…That's in C4.…And finally the Discount rate,…
- Analyzing loans, payments, and interest
- Calculating depreciation
- Determining values and rates of return
- Calculating bond coupon dates and security durations
- Calculating security prices and yields
- Calculating prices and yields of securities with odd periods
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. Calculating Prices and Yields of Securities with Odd Periods
Additional resources1m 24s
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