This course provides an overview of the techniques available for valuing riskless and risky fixed income securities and their derivatives. Topics include fixed income mathematics, price sensitivity measures, securitization, and interest rate models. This course involves the use of a financial calculator and the development of Excel spreadsheets for solving complex problems.
Intended Learning Outcomes
CILO-1: Construct the term structure of interest rates used for bond valuation.
CILO-2: Quantify bond price sensitivity using duration and convexity.
CILO-3: Assess various risks in bond investments.
CILO-4: Find the price of bonds with embedded options using interest rate models and associated binomial trees.