Monday

March 30, 2015

March 30, 2015

Posted by **Rajini** on Wednesday, April 11, 2007 at 9:56pm.

Coupon payments every 6 months might be small and therefore, cannot be reinvested in an efficient manner.

Interest rates at the time of the coupon payments will not be identical to YTM rate calculated.

The dynamics of the real world markets and the supply and demand for borrowing and lending almost predict that rates will be different on the coupon dates than the YTM calculation assumes.

This is the best math formula we have; and universally accepted.

All of the above statements are correct.

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