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Search results “Bonds price and interest rates”

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Help us make better videos: http://www.informedtrades.com/donate Trade stocks and bonds with Scottrade, the broker Simit uses: http://bit.ly/scottrade-IT (see our review: http://bit.ly/scottrade-IT2) KEY POINTS 1. Bond prices and bond yields move in opposite directions. When bond prices go up, that means yields are going down; when bond prices go down, this means yields are going up. Mathematically, this is because yield is equal to: annual coupon payments/price paid for bond A decrease in price is thus a decrease in the denominator of the equation, which in turn results in a larger number. 2. Conceptually, the reason for why a decrease in bond price results in an increase bond yields can be understood through an example. a. Suppose a corporation issues a bond to a bondholder for \$100, and with a promise of \$5 in coupon payments per year. This bond thus has a yield of 5%. (\$5/\$100 = 5%) b. Suppose the same corporation then issues additional bonds, also for \$100 but this time promising \$6 in coupon payments for year -- and thus yielding 6%. No rational investor would choose the old bond; instead, they would all purchase the new bond, because it yielded more and was at the same price. As a result, if a holder of the old bonds needed to sell them, he/she would need to do so at a lower price. For instance, if holder of the old bonds was willing to sell it at \$83.33, than any prospective buyer would get a bond that earned \$5 in coupon payments on an \$83.33 payment -- effectively an annual yield of 6% (5/83.33). The yield to maturity could be even higher, since the bond would give the bondholder \$100 upon reaching maturity. 3. The longer the duration of the bonds, the more sensitivity there is to interest rate moves. For instance, if interest rates rise in year 3 of a 30 year bond (meaning there are 27 years left until maturity) the price of the bond would fall more than if interest rates rise in year 3 of a 5 year bond. This is because an interest in interest rates reduces the relative appeal of existing coupon payments, and the more coupon payments that are remaining, the more interest rate fluctuations will impact the price of the bond. 4. Lastly, a small note on jargon: when investors or commentators say, "bonds are up," (or down) they are referring to bond prices. "Bonds are up" thus means bond prices are up and yields are down; conversely, "bonds are down" means bond prices are down and yields are up.

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Views: 15945 Dan Thornton

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How a bond works, how bond prices change inversely with interest rates, and how open market operations by the FED influence interest rates and the economy.
Views: 43456 TheWyvern66

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https://goo.gl/55atY2 for more FREE video tutorials covering Macroeconomics.
Views: 1472 Spoon Feed Me

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​In this revision video we work through some numerical examples of the inverse relationship between the market price of fixed-interest government bonds and the yields on those bonds. ​Government bonds are fixed interest securities. This means that a bond pays a fixed annual interest – this is known as the coupon The coupon (paid in £s, \$s, Euros etc.) is fixed but the yield on a bond will vary The yield is effectively the interest rate on a bond. The yield will vary inversely with the market price of a bond 1.When bond prices are rising, the yield will fall 2.When bond prices are falling, the yield will rise - - - - - - - - - MORE ABOUT TUTOR2U ECONOMICS: Visit tutor2u Economics for thousands of free study notes, videos, quizzes and more: https://www.tutor2u.net/economics A Level Economics Revision Flashcards: https://www.tutor2u.net/economics/store/selections/alevel-economics-revision-flashcards A Level Economics Example Top Grade Essays: https://www.tutor2u.net/economics/store/selections/exemplar-essays-for-a-level-economics
Views: 36925 tutor2u

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Views: 554 Brian Fricke

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In this lecture, we price the same standard bond given three different ratings agency ratings, which has given us three different required overall yields to get from the bond, given the changing levels of risk. After explaining the theory of present valuing the different fixed cashflows, we then use an Excel spreadsheet to calculate the three different bond prices. The lecture finishes with an Excel chart which displays the relationships between coupon rate, flat yield, and yield to maturity, as well as highlighting the most important concept in bond trading; when required interest rates go up, bond prices go down, and when required interest rates go down, bond prices go up. For those who wish to know how to calculate a yield to maturity given a market bond price, see the next lecture. Previous: http://www.youtube.com/watch?v=-tN32FU3D_k Next: http://www.youtube.com/watch?v=hHR_GSEisRs For financial education from London to Singapore and beyond, please contact MithrilMoney via the following website: http://mithrilmoney.com/ This MithrilMoney lecture was delivered by Andy Duncan, CQF. Please read our disclaimer: http://mithrilmoney.com/disclaimer/
Views: 40714 MithrilMoney

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Views: 8657 arnoldhite

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THIS IS SHORT VIDEO OF ECONOMICS DICTIONARY IN HINDI
Views: 1197 Ideal Coaching

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How to Prepare Indian Economy for UPSC CSE Prelims 2019 ? Video Link : https://youtu.be/SYuTBEMmzJ4 To Join Economy Prelims Telegram Channel - https://t.me/NEOIASECONOMYPRELIMS To Join Economy Mains Channel https://t.me/NEOIASECONOMYMAINS Economy Previous Year Questions Link : https://drive.google.com/open?id=1zmjyKUMAttVddsQ6wInX1zGBKfy-jU0q Learn complete concept of Indian Economy for CIVIL SERVICE EXAMINATION in the simplest way. NEO IAS e-learning classes is an online program which aims to create CIVIL SERVANTS for the development of the nation by providing the video series of complete topics that are relevant for the CIVIL SERVICES (IAS/IPS) Exam.

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Why bond prices move inversely to changes in interest rates.
Views: 10857 Practical Money Skills

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To download the Handouts, Please Join https://t.me/currentaffairsmkyadav The video Explains the relationship between Bond Price, Bond Yield, Interest Rate, SLR, Inflation, Oil Prices, FDI/FPI
Views: 2396 MK Yadav - theIAShub

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Khan Academy on Bond Prices and Interest Rates
Views: 149413 Jonathan Horn

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This video explains why major central banks across the world try to target an increased inflation. This video explains how inflation benefits the debt issued by major central banks across the world. This video explains the concept of rising interest rates along with inflation and its effect on bond prices.

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This video explains the relationship between inflation and interest rates along with bond prices and rates. This video explains inflation and its effect on interest earned by investors. यह विडियो महंगाई दर और इंटरेस्ट रेट के बीच के सम्बन्ध को समझाता है, की किस प्रकार से महंगाई दर के बढ़ने और घटने का असर इंटरेस्ट रेट आदि पर पड़ता है.

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This video will show you how to calculate the bond price and yield to maturity in a financial calculator. If you need to find the Present value by hand please watch this video :) http://youtu.be/5uAICRPUzsM There are more videos for EXCEL as well Like and subscribe :) Please visit us at http://www.i-hate-math.com Thanks for learning
Views: 277346 I Hate Math Group, Inc

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What's the difference between a spot rate and a bond's yield-to-maturity? In this video you'll learn how to find the price of the bond using spot rates, as well as how to find the yield-to-maturity of a bond once we know it's price. Simply put, spot rates are used to discount cash flows happening at a particular point in time, back to time 0. A bond's yield-to-maturity is the overall return that the investor will make by purchasing the bond - think of it as a weighted average!
Views: 2603 Arnold Tutoring

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Investors should observe the Federal Reserve’s funds rate, which is the cost banks pay to borrow from Federal Reserve banks. What's going on with Japan's interest rates? Read here: http://www.investopedia.com/articles/investing/012916/bank-japan-announces-negative-interest-rates.asp?utm_source=youtube&utm_medium=social&utm_campaign=youtube_desc_link
Views: 73039 Investopedia

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Interest rates go up and the price of the bonds go down. A quick illustration to help you understand that concept.
Views: 1609 That Bond Guy

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How changing interest rates impact fixed income funds and ETFs and what to do about it.

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India's Bond markets are largely unknown to the retail investor. This is because they are mostly dominated by institutions like banks, mutual funds and insurance companies. However it must be known that within mutual funds, a large part of the industry AUM is in liquid funds, which invest in money market instruments which are essentially very short term debt papers. In this video we try to understand how bond markets move due to changes in interest rates and what mistakes investors should not be making while taking investing decisions in bonds. To know more about our online trainings, call Shailesh: 8600043130. Please write your comments and feedback so that we can incorporate that in our future videos. Thank you for watching

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Views: 71 Life insurance

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The Ole Captain does what most economists and finance professors can't do, and explains the inverse relationship between bond prices and interest rates to NORMAL PEOPLE. Visit Cappy's other sites for rants, rage, and Super Awesome Economic Genius! http://captaincapitalism.blogspot.com http://aaron-clarey.podomatic.com http://www.assholeconsulting.com
Views: 4284 AaronClarey

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This video explains how to calculate a bond that sells at a discount. It shows the corresponding journal entries on the original sale and interest payments. It also shows how to prepare the amortization table and explains what the numbers represent.
Views: 23369 mattfisher64

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One of the least understood topics among introductory Econ students is how bond markets work. This video lesson introduces the bond market, and explains how the demand for a government's debt is an important determination of the borrowing costs faced by that government. We will answer some important questions about bond markets, such as, "What's the relationship between bond prices and bond yields?" and "How could budget deficits and debt affect interest rates?" In the next video we'll examine circumstances under which large budget deficits and national debt may NOT drive up a government's borrowing costs. Want to learn more about economics, or just be ready for an upcoming quiz, test or end of year exam? Jason Welker is available for tutoring, IB internal assessment and extended essay support, and other services to support economics students and teachers. Learn more here! http://econclassroom.com/?page_id=5870
Views: 12096 Jason Welker

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When interest rates go up, bond prices go down. Understanding the relationship between bond prices, interest rate changes and the bond's current yield is important for investors.
Views: 4495 InvestingForMe

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Consider the following spot interest rates for maturities of one, two, three, and four years. Year | Rate 1 | 4% 2 | 5% 3 | 6% 4 | 7% What is the price of a four year, 4 percent coupon bond with a face value of \$100? Assume the bond pays an annual coupon. What are our expectations of the yield for a one year bond that starts in one, two, and three years, i.e., what are the forward rates? Suppose the inflation expectations are a constant 2 percent, what are the expected real interest rates for each one year period in the future? Suppose that immediately after purchasing the bond that market expectations of the inflation rate decrease to a constant one percent. What are our new nominal forward rates? Assume expectations of real interest rates have not changed. In one year, what do we expect the new term structure of interest rates to be? In one year, what do we expect the price of the bond to be based on the new term structure of interest rates? What do we expect the holding period return to be if you sell it immediately after receiving the first year’s coupon? Note: There is a typo in calculating the holding period return. The correct formula is (92.22 - 90.17 + 4)/90.17 = 6.7% Note: A pdf of the solution is available from here: https://goo.gl/MeMDkv

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Views: 16169 Edspira

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This recent drop in bond prices and rise in bond yields could have major repercussions on the economy, and signal that the end of the expansion has arrived. Help support the Silver Fortune Channel through my sponsor, SD Bullion - 10 oz. Silver Bar at Spot! https://sdbullion.com/sf Support Silver Fortune through Patreon: https://www.patreon.com/silverfortune Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
Views: 1751 Silver Fortune

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Views: 1583 ecopoint

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Rising interest rates can push down the price of existing bonds (also referred to as fixed income), which in turn could directly affect the current value of your bond holdings. As Diczok notes in this latest episode of Market Decode, this doesn’t make bonds any less essential to a well-diversified portfolio—especially as volatility or a market drop can have an impact on the value of your stocks. For more on this topic, go to https://www.ml.com/articles/stocks-or-bond-what-happens-when-rates-rise.html
Views: 249 MerrillLynch

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Read 'Why bond yields are so low' : http://on.ft.com/2e9kOE0 Negative yielding bonds are bonds which have a negative interest rate. It means that when a person buys those bonds, instead of generating profit, they lose money. Why would anyone buy such bonds then? Some institutions are forced legally, others are betting and hope to make money. ► Subscribe to the Financial Times on YouTube: http://bit.ly/FTimeSubs For more video content from the Financial Times, visit http://www.FT.com/video Twitter https://twitter.com/ftvideo Facebook https://www.facebook.com/financialtimes
Views: 4566 Financial Times

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Views: 4847 Mark Matos

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Views: 13397 Vanguard

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At first it might appear confusing that bond prices fall when interest rates rise - when properly looked at though this makes a lot of sense. This video clarifies why this is the case.
Views: 8823 savingandinvesting

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The inverse relation between interest rates and bond prices is the most fundamental topic for bond markets. Once this logic is understood, it helps us investing not only in debt but also in equities and also in making our personal finance decisions better. Money Bee Institute Pvt. Ltd. organises Live Session once every month for its registered participants. This video is a part of the session organised on 29 Apr 2018 on 'Understanding G - Sec Basics'. People from all over India and also abroad join our sessions. Next session is on 6 May on 'Crude Oil and Inflation'. To join our Online Capital Markets Module kindly register by going here: http://www.moneybee.info/moneybee/register.php To know more please WhatsApp on 8600043130 Thank you for liking our videos and subscribing to our channel. Team Money Bee :)

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Pacer ETFs President Sean O’Hara discusses how rising interest rates are impacting bonds and where investors should allocate their capital.

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FinTree website link: http://www.fintreeindia.com FB Page link :http://www.facebook.com/Fin... This series of videos covers following key areas: The most commonly used day count conventions, describe the markets that each one is typically used in, and each to an interest calculation The conversion of a discount rate to a price for a US Treasury bill The clean and dirty price for a US Treasury bond; The accrued interest and dirty price on a US Treasury bond A US Treasury bond futures contract conversion factor The cost of delivering a bond into a Treasury bond futures contract The impact of the level and shape of the yield curve on the cheapest-to-deliver Treasury bond decision The theoretical futures price for a Treasury bond futures contract The final contract price on a Eurodollar futures contract The Eurodollar futures contract convexity adjustment How Eurodollar futures can be used to extend the LIBOR zero curve We love what we do, and we make awesome video lectures for CFA and FRM exams. Our Video Lectures are comprehensive, easy to understand and most importantly, fun to study with! This Video lecture was recorded by our popular trainer for CFA, Mr. Utkarsh Jain, during one of his live FRM Classes in Pune (India).
Views: 16318 FinTree

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http://www.learnbonds.com/bond-duration/ - Bond Duration is a measurement of how long it takes for the price of a bond to be matched by the money it generates. Here is a video overview.
Views: 10399 Learn Bonds

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This video is one part of BondSavvy's 10-part video "The Crash Course on Corporate Bond Investing." The full Crash Course video is included with a subscription to BondSavvy https://www.bondsavvy.com/corporate-bond-investment-picks or can be bought on its own here https://www.bondsavvy.com/a-la-carte/corporate-bond-investing-101. This video explains the differences between interest rate risk and credit risk and how you can factor this into your next corporate bond investment. Many investors only invest in investment-grade bonds because they are afraid of the default risk of high-yield (or below investment grade) bonds. The challenge with this thinking is that investment-grade bonds often have longer durations (or time until maturity) and are therefore more sensitive to changes in interest rates. To alleviate these risks, it's important for investors to consider both investment-grade and non-investment-grade corporate bonds. You will learn the following by watching this video: * Difference between investment-grade corporate bonds and high-yield corporate bonds * Difference in default rates between investment-grade corporate bonds and high-yield corporate bonds * How bond prices are quoted * How owning high-yield corporate bonds can help reduce investors' interest rate risk * Why shorter-dated bonds are less sensitive to changes in interest rates * What happens to bond prices when interest rates increase?
Views: 134 BondSavvy

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In this video clip I explain the relationship between the price of a treasury bill and the interest.
Views: 22129 lostmy1

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