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INTEREST RATE, FACTORS AFFECTING, image, image, image - Coggle Diagram
INTEREST RATE
DETERMINANTS OF INTEREST
MATURITY RISK PREMIUM
longer-termbonds, even Treasury bonds, are exposed to a significant riskof price declines due to increases in inflation and interestrates; and a maturity risk premium is charged by lenders toreflect this risk.
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DEFAULT RISK PREMIUM
The difference between the interest rate on a U.S. Treasury bond and a corporate bond of equal maturity and marketability.
trong Th cong ty bị phá sản, mình sẽ có 1 khoản đc đền bù trong lợi tức của trái phiếu
INFLATION RATE
The inflation rate is a measure of changing prices, typically calculated on a month-to-month and year-to-year basis and expressed as a percentage
LIQUIDITY PREMIUM
A premium added to the equilibrium interest rate on a security if that security cannot be converted to cash on short notice and at close to its “fair market value.”
đền bù cho tính thanh khoản của trái phiếu; VD trái phiếu chính phủ có tính thanh khoản cao thì cái đền bù sẽ thấp
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EXPECTATION THEORY
ASSUMPTIONS
the maturity risk premium for Treasury securities is zero.(luôn luôn đc giữ cho đến thời gian đáo hạn)
the shapes of yield curve in PEH-is upward sloping
we can cal forward rate and spot rate
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Long-term rates are an average of current and future short-term rates.
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If PEH is correct, you can use the yield curve to “back out” expected future interest rates.
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EXPLAINATION
The PEH contends that the shape of the yield curve depends on investor’s expectations about future interest rates.
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YIELD CURVE
SHAPES OF YIELD CURVE
đường cong lãi suất, đường cong lợi tức
phản ánh giữa thời gian và lãi suất
FLAT YIELD CURVE
When there is little or no difference between short-and long-term rates, the yield curve is referred to as flat
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