The theoretical transfer price formula of bond price is: bond face value ×( 1+ coupon rate × actual holding period) but there is another formula!

The square of (1+i)/c1+(1+i)+. +( 1+i) to the nth power/cn+F. Bond yield = (principal and interest due and-issue price)/(issue price * repayment period) * 100% Bond yield is the ratio of bond yield to its invested principal, which is usually expressed by annual interest rate. Bond income is different from bond interest. Because people can buy and sell bonds in the market during the holding period, the bond income includes not only interest income, but also the difference between trading profit and loss.

1. Investing in bonds, we are most concerned about the yield of bonds. In order to accurately measure the bond yield, the bond yield is generally used as an indicator. The main factors that determine the bond yield are coupon rate, maturity, denomination and purchase price. Since the holder may transfer the bond during the repayment period, the bond yield can also be divided into the bond seller's yield, the bond buyer's yield and the bond holding period. Their respective calculation formulas are as follows:

Seller's yield = (selling price-issue price+holding period interest)/(issue price * holding period) * 100%

Buyer's yield = (principal and interest due and-purchase price)/(purchase price * remaining term) * 100%

Holding period yield = (selling price-buying price+holding period interest)/(buying price * holding period) * 100%. Extended data

2. There are four rates of return on bond investment: coupon rate, direct rate of return, yield to maturity and holding rate. Par yield, also called Paryield, refers to the ratio of interest income to par value, which is equivalent to coupon rate in value. Obviously, coupon rate assumes that the purchase value of bonds is equal to the face value, regardless of other sources of income, so coupon rate can only be the simplest measure of the rate of return, and cannot explain the investment value of bonds. The formula for calculating coupon yield is:

Par yield = annual interest income/face value of bonds × 100% = coupon rate.

The coupon rate is only applicable to investors who buy bonds at par value and hold them until maturity to recover their principal at par value. He did not consider the possibility that the purchase price might be inconsistent with the face value, nor did he consider the possibility of selling bonds halfway without holding them due. Therefore, the coupon rate of return does not really reflect the income of bond investment.

Current output

3. The direct rate of return is the ratio of the annual interest income of bonds to the purchase price. Considering that the purchase price of bond investors may not be equal to the face value, the yield will be replaced by the real purchase price. The calculation formula of direct rate of return is:

Where y is yield to maturity, p is the bond purchase price (which can be less than, greater than or equal to the bond denomination, depending on the market situation), I is the annual interest paid, and m is the denomination. This formula has exactly the same structure as the previous formula for calculating the theoretical price of interest-bearing bonds, except that this formula calculates the yield to maturity from the price, while the latter calculates the price from the determined rate of return.

If the remaining maturity of the bond at the current point in time is not an integer, then the more complicated formula is:

Where w is the remaining interest-bearing days from the current interest-bearing date to the latest interest-bearing date.

The calculation of yield to maturity of interest-bearing bonds is complicated, because it involves the operation of power. Theoretically, when n > 4, the value of y may not be directly obtained. To solve this equation, the "trial and error method" is usually used:

4. First estimate a y value and substitute it. If the calculated present value is less than the bond purchase price, it is replaced by another smaller Y value; On the contrary, if the calculated present value is greater than the bond purchase price, it is substituted into another larger Y value, and so on until the correct yield to maturity is found. Almost all computer programs adopt this principle of trial and error, but the trial and error method is more reasonable in calculation, so the speed of finding the correct solution is faster. The most common calculation methods are "difference iteration method" and "Newton iteration method".