Tier 3 · AdvancedFree

Fixed Income and Rates

Bond Math

8 modules~58 min totalVerifiable certificate on completion

Syllabus

01Bond Pricing and the Price-Yield RelationshipMath
9 min
02Duration: The First Derivative of PriceMath
9 min
03Convexity: The Second Derivative and the CorrectionMath
9 min
04Why a Bond's Price Falls When Rates Rise
6 min
05Three Ways to Measure Yield
6 min
06The Duration Decision
7 min
07Reading the Curve
6 min
08The Spread
6 min

From Module 1 — read a sample

A bond is just a promise to pay cash flows at set dates. Its price = the present value of all those cash flows, discounted at the current market interest rate. When rates rise, bond prices fall — they move opposite, because the same fixed cash flows are worth less when discounted at a higher rate.

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