Bond Market

Assessing a Bond’s Liquidity Risk Understanding Bond Liquidity Risk Before delving into how to assess a bond’s liquidity risk, it’s crucial to understand what this term means. Liquidity risk in the bond market refers to the risk that an investor will not be able to sell a bond readily or at a predictable price because …

Quantitative Bond Analysis: An In-Depth Understanding As an individual interested in the bond market, you may have already heard the term ‘Quantitative Bond Analysis’. However, are you aware of its essential facets, its implementation, and how can it benefit your investment decisions? If not, let’s delve deeper into this topic. What is Quantitative Bond Analysis? …

Determining the Price of a Bond Before getting into the crux of the topic, it’s first essential to understand what a bond is. A bond is a type of investment instrument that acts as a loan between an investor and a bond issuer, typically an entity like a corporation or government. The issuer borrows the …

Analyzing a Bond’s Credit Risk Understanding and analyzing the credit risk of bonds is essential for every bond investor, regardless of their level of experience in the market. Credit risk, defined as the likelihood that the issuer of a bond will default or fail to fulfill their payment obligations, can significantly impact the bond’s overall …

Understanding Duration in Bond Valuation Introduction to Bond Valuation Before delving into bond duration, it’s crucial to understand bond valuation. A bond can be likened to a loan: the issuer is the borrower (debtor), the bond holder is the lender (creditor), and the coupon rate is the interest. When governments and corporations need to raise …

Understanding Interest Rate Risk Analysis in Bonds An Overview of Interest Rate Risk in Bonds Interest rate risk is a fundamental concept in the bond market that every investor—whether beginner or expert—should be well-acquainted with. Essentially, interest rate risk represents the potential for investment losses that can occur due to a change in prevailing interest …