Bond Basics: Reading a Bond Table GE 6.25 Feb02/08 105 5.25 Column 1: Issuer - This is the company, state (or province), or country that is issuing the bond. Column 2: Coupon - The coupon refers to the fixed interest rate that the issuer pays to the lender. Column 3: Maturity Date - This is the date on which the borrower will pay the investors their principal back. Typically only the last two digits of the year are quoted, 25 means 2025, 04 is 2004, etc. Column 4: Bid Price. This is the price someone is willing to pay for the bond. It is quoted in relation to 100, no matter what the par value is. Think of the bid price as a percentage: a bond with a bid of 93 means it is trading at 93% of its par value. Column 5: Yield. The yield indicates annual return until the bond matures. Usually this is the yield to maturity, not current yield. If the bond is callable it will have a "c--" where the "--" is the year the bond can be called. For example c10 means the bond can be called as early as 2010.
Title: Bond Markets Analysis and Strategy Author: Fabozzi If you need to learn about Bonds then this is the book to start with ...... One of my clients, who runs the largest bond fund in the US, uses this book to train new recruits and they seem to be doing OK .....
Indeed Fabozzi is the most recognized author on this subject. But it's useless if you don't plan to become an advanced bond trader. If all you want to do is applying techical analysis to a bond chart, you don't need the book.
Fabozzi, at least one of his numerous books, is on 99.95% of fixed income desks, funds, investment houses around the globe and this is a very conservative estimate. nevertheless it ain't an easy read if you are not so much in quant/science/math stuff or do not have the time to dig little here and there. i would advise to buy an easy-read of the kind "getting started ..." as well. might save energy. peace
Trading details are not included in the book but IMHO you need the knowledge before you start developing your trading plan. For instance if you wanted to work for us we would apply the same criteria as a large bond trading house: You need to know this information FIRST...... Then come talk to me about trading etc .... FYI: the knowlege in Fabozzi is not just technical analysis applied to a bond chart. If this is your opinion then you have never studied the text: The details of bond pricing are a bit more complicated and do not have zero relevance to trading plans. Another good reference is the Federal Reserve Web Sites where there are many studies concerning Bond Pricing etc.
Cal but gordon is not applying at your shop - or did i get that wrong? btw this client of yours is running a fixed income fund? long only or hedge fund? peace
most ctas who are trading bond futures in bulk have never seen a fabozzi ... well maybe not most but there are a t least some. peace