Jonboyz
14-03-2017, 03:59 PM
Hi
I'm very new to the bonds market and am trying to understand how to value a bond.
In the example below (inserted image of bond calculation for AIA210 today), I would be very grateful if someone could help me understand how to interpret a bond calculator (ANZ securities bond calculator):
1. The principal is how much I would pay to purchase the bonds at this moment = $985.14
2. Accrued interest is how much interest this bond has already earnt since the last coupon payment = $16.01
3. Cum interest price is simply principal + accrued interest = $1001.15
3. Ex interest price the principal minus the interest that will be earnt between settlement date and the next coupon payment = $981.38
=> My question is what number do I compare to the information on https://www.nzx.com/markets/NZDX/bonds/AIA210 to see whether it is undervalued or overvalued? Ex interest price is same as present value?
Thanks for helping with this :)
8745
I'm very new to the bonds market and am trying to understand how to value a bond.
In the example below (inserted image of bond calculation for AIA210 today), I would be very grateful if someone could help me understand how to interpret a bond calculator (ANZ securities bond calculator):
1. The principal is how much I would pay to purchase the bonds at this moment = $985.14
2. Accrued interest is how much interest this bond has already earnt since the last coupon payment = $16.01
3. Cum interest price is simply principal + accrued interest = $1001.15
3. Ex interest price the principal minus the interest that will be earnt between settlement date and the next coupon payment = $981.38
=> My question is what number do I compare to the information on https://www.nzx.com/markets/NZDX/bonds/AIA210 to see whether it is undervalued or overvalued? Ex interest price is same as present value?
Thanks for helping with this :)
8745