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Basic Question 4 of 14
What is the G spread between a 20-year, 9% corporate AA bond that is priced at $87.56, and a 20-year, 8% Treasury bond priced at $97.57?
B. 100 basis points
C. 225 basis points
A. 11 basis points
B. 100 basis points
C. 225 basis points
User Contributed Comments 4
| User | Comment |
|---|---|
| gill15 | I cant believe after all the bond questions we did i chose a 100 basis points... |
| ldfrench | Gotta remember to take it from semiannual to annual by multiplying it by 2. Always a common mistake |
| Fabulous1 | As the difference between the basis point options is this big you can just use the annual values and still get around 225 bp |
| brunoma94 | Its not the difference between coupon rate but the difference between YTM |
I was very pleased with your notes and question bank. I especially like the mock exams because it helped to pull everything together.
Martin Rockenfeldt
Learning Outcome Statements
compare, calculate, and interpret yield and yield spread measures for fixed-rate bonds
CFA® 2024 Level I Curriculum, Volume 4, Module 7.