Annual Coupon Bonds. HP 12C Platinum Financial Calculator, 12c

222 Section 16: Bonds

6

Þ

-

?6

:5

:1

¼

:3

M

$

:5

Æ fCLEARÎ fCLEARG gÂ

:0 n

:2

P

Annual Coupon Bonds

For bonds which have annual coupons, use the following hp 12c platinum program to evaluate price and accrued interest on an Actual/Actual day basis.

This program may be modified for annual coupon bonds to be calculated on a

30/360 day basis.

KEYSTROKES

(RPN mode) fs

DISPLAY

KEYSTROKES

(ALG mode) fs

DISPLAY

000, fCLEARÎ 000,

001, 42 34 fCLEARG 001, 42 34

002, 43 8 gÂ

003, 45 0 :0

004, 11 n

002, 43 8

003, 45 0

004, 11

005, 45 2

006, 14

007, 45 1

008, 12

009, 45 3

010, 15

:2

P

:1

¼

:3

M

011, 13 $

012, 45 5 :5

013, 26 -

014, 6 Æ

015, 16 6

016, 30 Þ

017, 44 6 ³

018, 45 5 ?6

005, 45 2

006, 14

007, 45 1

008, 12

009, 45 3

010, 15

011, 13

012, 45 5

013,

014,

015,

016,

017,

30

26

6

16

36

018, 44 6

File name: hp 12c pt_user's guide_English_HDPMF123E27 Page: 222 of 275

Printed Date: 2005/8/1 Dimension: 14.8 cm x 21 cm

Section 16: Bonds 223

0

P

M

Þ

:n

:2

Þ

§ t

- fs

KEYSTROKES

(RPN mode) gÒ

DISPLAY

KEYSTROKES

(ALG mode)

019, 43 26 :5

DISPLAY

019, 45 5

?7

:6

:4 gÒ

:7 z n

020, 44 7 gÒ

021, 45 6 ?7

022, 45 4 :6

023, 43 26 :4

024, 45 7 gÒ

025, 10 z

020, 43 26

021, 44 7

022, 45 6

023, 45 4

024, 43 26

025, 10

026, 45 7 026, 11 :7

027, 0 n

028, 14 0

029, 15 P

030, 16 M

031, 45 11 :n

032, 45 2 §

033, 16 :2

034, 20 Þ

035, 31 +

036, 30 t

~

³

Þ

027,

028,

029,

030,

031, 45 11

032,

033, 45 2

034,

035,

036,

037,

038,

039,

11

0

14

15

20

16

40

31

34

36

16 fs

File name: hp 12c pt_user's guide_English_HDPMF123E27 Page: 223 of 275

Printed Date: 2005/8/1 Dimension: 14.8 cm x 21 cm

224 Section 16: Bonds

REGISTERS n: Used i: Yield PV: Used PMT: Cpn. or 0

FV: Used

R

3

: Redemption

R

0

: # Periods (n) R

1

: Yield

R

4

: Settlement R

5

: Next Cpn.

R

2

: Coupon

R

6

: Last Coupon

R

7

: Used R

8

–R

.5

: Unused

For annual coupon bonds calculated on a 30/360 day basis, insert d after gÒ at steps 19 and 23 in the RPN mode program and after gÒ at steps

20 and 24 in the ALG mode (making each program two steps longer).

1. Key in the program and press ?É if the C status indicator is not displayed.

2. Key in the total number of coupons which are received and press ?0.

3. Key in the annual yield as a percentage then press ?1.

4. Key in the amount of the annual coupon then press ?2.

*

5. Key in the redemption value then press ?3.

*

6. Key in the settlement (purchase) date † then press ?4.

7. Key in the date of the next coupon then press ?5.

8. Press t to obtain the amount of accrued interest.

9. Press t to determine the price of the bond.

10. For a new case, return to step 2.

Example: What is the price and accrued interest of a 20-year Eurobond with annual coupons of 6.5% purchased on August 15, 2004 to yield 7%. The next coupon is received on December 1, 2004.

Keystrokes

(RPN mode) f]

?Æ

Keystrokes

(ALG mode) f[

?Æ

Display

20?0 20?0

7?1 7?1

6.5?2 6.5?2

20.00

7.00

6.50

Set compound interest mode if the C indicator is not on.

Total number of coupons.

Annual yield.

Annual coupon rate.

* Positive for cash received; negative for cash paid out.

† For information about date format see page 37.

File name: hp 12c pt_user's guide_English_HDPMF123E27 Page: 224 of 275

Printed Date: 2005/8/1 Dimension: 14.8 cm x 21 cm

Section 16: Bonds 225

Keystrokes

(RPN mode)

Keystrokes

(ALG mode)

Display

100?3 100?3 100.00

8.152004?4 8.152004?4

8.15

12.012004?5 12.012004?5

12.01 t t –4.58 t t –94.75

Redemption value.

Settlement date.

Next coupon date.

Accrued interest.

Purchase price.

File name: hp 12c pt_user's guide_English_HDPMF123E27 Page: 225 of 275

Printed Date: 2005/8/1 Dimension: 14.8 cm x 21 cm