failed...if investopedia info doesn't make any sense to i going to try (i hope you can appreciate that) to explain how accrued interest works. btw-you really should do your homework and at least TRY to figure this out on your own.(no wonder you failed) semi annual mean-interest is paid twice a year. let say 1/1/2011 and 6/1/2011 you bought this bond today. from 1/1/2011 till today is like 9 days. YOU have to pay the guy,who sold this bond to you. whatever ACCRUED(accumulated, if you will) interest for those 9 days is. BUT! take a closer look in detailed description from IB site on same bond i post earlier. notice that the COUPON TYPE IS FIXED. mean-they will pay twice a year and payment will be fixed amount of money. my example above will work for this type. now- if you too fucking lazy to use that FINRA link and put the fucking CUSIP in it-i done that for you. and from what i see-your bond coupon type is VARIABLE. how much and when they are paying -i don't fucking know... at least it's not callable.you bought this piece of shit BBB rated with YTM lower than my local bank is paying on money market(2%). i just bought 2 years CD(FDIC insured) @ 2.25%. and your junk is currently traded @ 1.77%, traded @ 118 with par probably 100. mean-@ maturity price will go down to 100 and you are going to have a loss,which will be recouped by interest payments. after all above-you hopefully will finish with 1.77% profit.(assuming they not going to default on this enormous 1.4B loan somewhere in between) does this make more sense now? or still too hard to understand what some russian guy with zero professional knowledge in US finances is trying to tell you? in this post above i did explain you more,than any financial adviser from any big full service firm will tell their average customer. do your home work pal. i'm no fucking expert in this field. YOUR knowledge level should be at least this good, before you spend a dime on whatever. you must know, what you are buying and all possible scenarios. educate yourself,no one will do that for you. or soon you nick will be fucked and failed. take care http://cxa.marketwatch.com/finra/BondCenter/BondDetail.aspx?ID=MDIyMDlTQUM3 http://www.investopedia.com/university/advancedbond/advancedbond1.asp
Interesting thing about this issue is that it doesn't seem to be callable, but it does have a "poison put" provision subject to a ratings downgrade trigger. The coupon also steps up/down by 25bp for each ratings downgrade/upgrade below BBB- (capped at 2%). I kinda agree with Bob111...why would you buy this to yield about the same as a CD, unless you were a hedge fund that could take advantage of an "arb" in the cap structure. I'm not a credit guy, but perhaps others with experience can comment?
omg??? the coupon rate is 8,5%. This makes no sense the yield is 1,8%?? Isnt the yield 8,5%??? And whats the difference between fixed and variable anyways. If they say they pay 8.5% dividend they cant make it variable and make it 1.8% dividend. That would be illegal!
huh? what is poison put? I dont see this mentioned anywhere on the website of finra. So the coupon can do to 6.5% or to 10.5%?
listen..90% of your questions will be disappear and you will know something new..only if you read the links in this and my previous posts and try to understand the information presented to you. if you don't understand-use search like google or something. internet is a beautiful thing,use it for you own good,before you gvt shut it down. once again-spend some time to educate yourself,then come back with whatever you don't understand. cause right now you asking the questions on kindergarten level. or maybe you are 5-10 years old? here- read main article and all the links below http://www.investopedia.com/terms/c/corporatebond.asp http://finance.yahoo.com/bonds btw-how much did you pay for it? looks like you need a math lesson too
You can google "poison put" to get more information on that. Yes, according to Bloomberg the coupon can change in the event of a credit event. I think that is what Bob meant by variable. As far as the relationship between coupon and yield, note that the bond is currently priced at 118. That means that from now until maturity, you will lose those 18 points, which will be offset by earning a higher coupon...8.5% as long as ratings don't change. The combination of the two means that, if nothing changes, you will earn around 1.8% on your investment.