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Debt Markets and Analysis, + Website

Book Description

An accessible guide to the essential elements of debt markets and their analysis

Debt Markets and Analysis provides professionals and finance students alike with an exposition on debt that will take them from the basic concepts, strategies, and fundamentals to a more detailed understanding of advanced approaches and models.

  • Strong visual attributes include consistent elements that function as additional learning aids, such as: Key Points, Definitions, Step-by-Step, Do It Yourself, and Bloomberg functionality

  • Offers a solid foundation in understanding the complexities and subtleties involved in the evaluation, selection, and management of debt

  • Provides insights on taking the ideas covered and applying them to real-world investment decisions

Engaging and informative, Debt Markets and Analysis provides practical guidance to excelling at this difficult endeavor.

Note: The ebook version does not provide access to the companion files.

Table of Contents

  1. Cover
  2. Series
  3. Title Page
  4. Copyright
  5. Dedication
  6. Preface
  7. Acknowledgments
  8. Part I: Bond Evaluation and Selection
    1. Chapter 1: Overview of the Financial System
      1. Real and Financial Assets
      2. Types of Debt Claims
      3. Financial Markets
      4. Types of Financial Markets
      5. Regulations
      6. Efficient Financial Markets
      7. Characteristics of Assets
      8. Conclusion
      9. Website Information
      10. Selected References
      11. Notes
    2. Chapter 2: Overview and Guide to the Bloomberg System
      1. Introduction
      2. Bloomberg System—Bloomberg Keyboard
      3. Accessing Some of the Information Discussed in Chapter 1
      4. Currency
      5. Indexes
      6. Functionality
      7. Screens
      8. Monitor and Portal Screens
      9. Bond Monitors: FIT, WB, RATT, RATC, CSDR, IM, and BTMM
      10. Portfolios and Baskets
      11. Screening and Search Functions
      12. The Bloomberg Excel Add-In: Importing Bloomberg into Excel
      13. Launchpad
      14. Other Bloomberg Functions
      15. Conclusion
      16. Bloomberg Exercises
    3. Chapter 3: Bond Value and Return
      1. Introduction
      2. Bond Valuation
      3. The Yield to Maturity and Other Rates of Return Measures
      4. Rates on Zero-Coupon Bonds
      5. Total Return
      6. Spot Rates and Equilibrium Prices
      7. Geometric Mean
      8. Conclusion
      9. Website Information
      10. Selected References
      11. Bloomberg Exercises
    4. Chapter 4: The Level and Structure of Interest Rates
      1. Introduction
      2. Level of Interest Rates
      3. The Structure of Interest Rates
      4. Term Structure and the Yield Curve
      5. Market Segmentation Theory
      6. Preferred Habitat Theory
      7. Pure Expectation Theory
      8. Liquidity Premium Theory
      9. Constructing the Benchmark Yield Curve
      10. Other Yield Curves
      11. Conclusion
      12. Website Information
      13. Selected References
      14. Bloomberg Exercises
      15. Notes
    5. Chapter 5: Bond Risk
      1. Introduction
      2. Default and Credit Risks
      3. Call Risk
      4. Interest Rate Risk
      5. Duration and Convexity
      6. Conclusion
      7. Website Information
      8. Selected References
      9. Bloomberg Exercises
      10. Notes
    6. Chapter 6: Bond Investment Strategies
      1. Introduction
      2. Active Investment Strategies
      3. High-Yield Bond Funds
      4. Passive Bond Management Strategies
      5. Bond Immunization Strategies
      6. Surplus Management and Duration Gap Analysis
      7. Conclusion
      8. Website Information
      9. Selected References
      10. Bloomberg Exercises
      11. Notes
  9. Part II: Debt Markets and Securities
    1. Chapter 7: Corporate Debt Securities
      1. Introduction
      2. Corporate Bonds
      3. Corporate Bonds with Special Features
      4. Medium-Term Notes
      5. Commercial Paper
      6. Bankruptcy
      7. Preferred Stock
      8. The Markets for Corporate Bonds
      9. Global Bond Investments
      10. Conclusion
      11. Website Information
      12. Selected References
      13. Bloomberg Exercises
      14. Notes
    2. Chapter 8: Government Securities and Markets: Treasury, Agencies, Municipals, and Sovereign Debt Securities
      1. Introduction
      2. Treasury Securities and Markets
      3. Agency Securities and Markets
      4. Municipal Securities and Markets
      5. Sovereign Government Debt
      6. Conclusion
      7. Website Information
      8. Selected References
      9. Bloomberg Exercises
      10. Notes
    3. Chapter 9: Intermediary Debt Securities, Investment Funds, and Markets
      1. Introduction
      2. Commercial Banks: Intermediary Securities
      3. Investment Funds
      4. Insurance Companies, Pension Funds, and Investment Banks
      5. Conclusion
      6. Website Information
      7. Selected References
      8. Bloomberg Exercises
      9. Notes
    4. Chapter 10: Mortgage-Backed and Asset-Backed Securities and Securitization
      1. Introduction
      2. Residential Mortgage Loans
      3. Mortgage Portfolio
      4. Mortgage-Backed Securities
      5. Features of Mortgage-Backed Securities
      6. Collateralized Mortgage Obligations and Strips
      7. Evaluating Mortgage-Backed Securities
      8. Commercial Mortgage-Backed Securities
      9. Asset-Backed Securities
      10. Conclusion
      11. Website Information
      12. Selected References
      13. Bloomberg Exercises
      14. Notes
  10. Part III: Debt Derivatives
    1. Chapter 11: Bond and Interest Rate Futures Contracts
      1. Introduction
      2. The Market and Characteristics of Futures on Debt Securities
      3. The Nature of Futures Trading and the Role of the Clearinghouse and Margins
      4. Futures Hedging
      5. Speculating with Interest Rate Derivatives
      6. Synthetic Debt and Investment Positions
      7. Futures Pricing
      8. Conclusion
      9. Website Information
      10. Selected References
      11. Bloomberg Exercises
      12. Notes
    2. Chapter 12: Bond and Interest Rate Option Contracts
      1. Introduction
      2. Option Terminology
      3. Markets and Types of Interest Rate Options
      4. Option Positions
      5. Hedging Fixed-Income Positions with Options
      6. Option Trading—Microstructure
      7. Interest Rate Calls and Puts, Caps and Floors
      8. Option Price Relationships
      9. Conclusion
      10. Website Information
      11. Selected References
      12. Bloomberg Exercises
      13. Notes
    3. Chapter 13: The Valuation of Bonds with Embedded Options and Debt Options—The Binomial Interest Rate Tree
      1. Introduction
      2. Binomial Interest Rate Model
      3. Convertible Bonds
      4. Valuation of Bond and Interest Rate Options
      5. Estimating the Binomial Tree
      6. Option-Adjusted Spread, Duration, and Convexity
      7. The Black-Scholes and Black Option Pricing Model
      8. Conclusion
      9. Website Information
      10. Selected References
      11. Bloomberg Exercises
      12. Notes
    4. Chapter 14: Interest Rate and Credit Default Swaps
      1. Introduction
      2. Generic Interest Rate Swaps
      3. Swap Market
      4. Swap Valuation
      5. Comparative Advantage and the Hidden Option
      6. Swaps Applications
      7. Credit Risk
      8. Forward Swaps
      9. Hedging a Future Investment
      10. Swaptions
      11. Nongeneric Swaps
      12. Credit Default Swaps
      13. Conclusion
      14. Website Information
      15. Bloomberg Exercises
      16. Selected References
      17. Notes
  11. Appendix A: Primer on Return, Present Value, and Future Value
    1. Holding Period Yield
    2. Annualized HPY
    3. Required Rates of Return and Value for a Single-Period Cash Flow
    4. Future and Present Values
    5. Future Value
    6. Future Value of an Annuity
    7. Present Value
    8. Present Value of an Annuity
    9. Valuing a Bond
  12. Appendix B: Uses of Exponents and Logarithms
    1. Exponential Functions
    2. Logarithms
    3. Rules of Logarithms
    4. Uses of Logarithms
    5. Solving for R
    6. Logarithmic Return
    7. Time
    8. Selected Reference
  13. Appendix C: Directory Listing of Bloomberg Screens by Menu and Function
  14. Index