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Basic Question 9 of 9

The bond described below is sold for settlement on August 25, 2026.

Annual coupon rate: 6%
Coupon payment dates (semi-annual payments): Mar 15 and September 15
Maturity date: September 15, 2030
Day count convention: 30/360
Annual yield-to-maturity: 5%

The full price the bond will settle at on August 25, 2026 is ______.

User Contributed Comments 9

User Comment
pranubal Is there any easy way to solve the above questions or ?
HolzGe1 It is easy:
1) Calculate PV as per coupon date Mar 15 via calculator:
N=9, I/Y=5/2=2.5, FV=100, PMT=3%*100=3, PV=?=103.99

2) Add Accrued Interest to arrive at the full price on Aug 25:
103.99 * (1 + 2.5%)^(160/180)
farhan92 I have a feeling i'll mess up the t/T bit in the exam
dlackie Why are we using YTM to calculate accrued interest?
merc5559 Same question as dlackie. I solved using coupon since that is related to the interest payment...
khalifa92 you're not calculating the accrued interest using I/Y, you're calculating the full price using I/Y and the time of accrued interest:

full price = clean + (r^(t/T))


AI= t/T * PMT
deleeuw why doesnt N=8? Next payment Sept 2026 (1), March 27 (2), Sept 27 (3) March 28 (4) Sept 28 (5) March 29 (6) Sept 29 (7) March 30 (8)....
MathLoser Bruh, why don't you count the Sep 30 (9)

BTW, this can be solved in like 10 seconds by using the [BOND] button on your calculator.
walterli @deleeuw read the note, the PV of the bond on last coupon payment date uses 9 periods of semi-annual basis. (Includes March 15th,2026) and use this value to calculate FV on settlement date.
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I am using your study notes and I know of at least 5 other friends of mine who used it and passed the exam last Dec. Keep up your great work!
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Learning Outcome Statements

calculate a bond's price given a yield-to-maturity on or between coupon dates

CFA® 2025 Level I Curriculum, Volume 4, Module 6.