Suppose the discount rate is 10%. You bought a 10-year, 8% coupon bond with 7 years after it is issued. After holding it for 2 years, the discount rate changed to 12% and sold the bond right after the discount rate change. What is your HPR (Assume par value is $1000 and semiannual coupons)?

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Debenture Valuation

A debenture is a private and long-term debt instrument issued by financial, non-financial institutions, governments, or corporations. A debenture is classified as a type of bond, where the instrument carries a fixed rate of interest, commonly known as the ‘coupon rate.’ Debentures are documented in an indenture, clearly specifying the type of debenture, the rate and method of interest computation, and maturity date.

Note Valuation

It is the process to determine the value or worth of an asset, liability, debt of the company. It can be determined by many processes or techniques. Many factors can impact the valuation of an asset, liability, or the company, like: