Bond markets and legal aspects of bonds. For government debt use the tag "government debt" unless the fact the the debt is in the form of bonds has significance.

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How will perpetual floating rate bonds respond to tighter capital requirements?

Floating-rate perpetual bonds will tend to rise or hold value with increasing market interest rates (in contrast to fixed rate bonds, which tend to exhibit and inverse relationship between price and ...
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Is it fair to compare 1950 US economy to 2016 US economy?

In the last 2 days, bond market has declined a bit. All major news outlets published articles like these: Can We Ignore the Alarm Bells the Bond Market Is Ringing? Such an event in bond market ...
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Connection between negative interest rates and negative bond yields

In an answer to one of my other questions: Why does falling global bond yields signal coming deflation, the answerer states: Whereas central banks set rates by policy, long term bond yields are ...
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Negative probabilities - Can we have negative payments in bonds?

In Half of a Coin: Negative Probabilities, the author mentions bond duration. Suppose we have payments at times $t = 1,2,...,n$ denoted respectively by $R_1, R_2, ..., R_n$ and the discount factor is ...
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103 views

Why does falling global bond yields signal coming deflation

In this article, it suggests that, "Bond markets are signalling something very nasty coming down the road at us – an all encompassing, worldwide deflation. " I cannot understand why bond yields ...
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Euro Corporate Bonds

I'm trying to divide my portfolio into asset classes and I'm not sure about the meaning of "Euro Corporate Bonds" and "Index-Linked euro govts". Does it mean that the bond is issued by a country where ...
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Do corporations outside of the Eurozone issue bonds in Euro?

Do corporate issuers outside of the Eurozone (as in the wider EU area, or non-EU countries) issue bonds in Euros (EUR)? How relatively common is this, compared to issuing bonds in USD, if you are a ...
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Bonds with embedded options pricing via binomial model

Notation: t - time; G(t) - zero-coupon yield curve; $r$, $r_d$, $r_u$ - interest rates. The task is to find market price of a bond for today, while knowing the price of a number of other bonds. ...
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54 views

Limits to Quantitative Easing Programmes

I have been reading recently on the quantitative easing programmes by the ECB and the BOJ, see http://www.cnbc.com/2016/04/07/what-the-bank-of-japan-boj-will-do-now-that-negative-rates-have-...
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Show that $W_t - \int_0^t \xi_s ds$ is forward-measure-Brownian

Definitions and stuff: Consider a filtered probability space $(\Omega, \mathscr F, \{\mathscr F_t\}_{t \in [0,T]}, \mathbb P)$ where $$T > 0$$ $$\mathbb P = \tilde{\mathbb P}$$ This is risk-...
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63 views

Fannie Mae and Freddie Mac as substitute benchmark bonds

"The reduction seen in US government debt in the late 1990s has led to a redution in the supply of intermediate and long-term government bonds, and some concern has arisen over this fact. In the ...
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Why aren't perpetual bonds more common?

Most government bonds and corporate bonds have a maturity date when the principal must be repaid. While the few percents of interest every year is generally not a big problem to pay out, when a bond ...
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Bond market vs stock market during crisis

Why does bond market not change as much as the stock market during financial crisis? On the picture we see the development of the two markets
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Finance/Fixed Income Sec: development of UK bond markets relative to the stock market

I am asked to describe (school project in the course Fixed Income Securities) the development of the UK bond markets relative the UK stock market and I am not sure how to tackle it. I want to compare ...
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Data source for a corporate bond yield curve?

Yield curves are a valuable tool for economic analysis. It is particularly interesting to analyse the difference between Government Debt yields and Corporate Debt yields (credit spreads). This gives ...
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152 views

Why is the Bank of Japan buying all the government bonds?

I've recently read that the Bank of Japan is continuously buying government bonds. Apparently, at the rate they are going, the BoC will own all the bonds by 2026, which means the government will ...
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30 views

negative interest rate lending ripple effects

I was attempt to describe the ramifications of negative interest rates across benchmarks. I can foresee the business practice changes amongst holders of government bonds, savings accounts, ...
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What happens to undated government stocks when interest rates dip below the coupon rate?

What happens to undated government stocks (debt— known as "bonds" in the US) which pay a coupon and have an embedded call option, when interest rates dip below the coupon rate? Will the market value ...
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23 views

Why can principal not be lost, if a bond fund is held for a period equal to its duration?

[Source:] Which leads us to the key message for investors: as long as your time horizon is at least as long as the duration of your bond fund, you won’t lose any capital. You’ve probably heard ...
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How do bonds with higher yields, help offset declines in bond prices?

[Source:] Another often overlooked point is that rising interest rates have a silver lining: $\color{green} { \text {new bonds are issued with higher coupons} }$, and this will eventually lead to ...
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What is the difference between present value and face value?

What is the difference between present value and face value? When I search this question on Google is says they're the same in some cases and different in others. It says they are the same when the ...
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1answer
38 views

How did downgrading bonds contribute to Greek crisis?

According to an article I read, one of the steps that was used to contribute to the Greek downfall was that bankers downgraded the bonds of the country. This immediately makes the interest rates (“...
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41 views

Regulatory differences between stocks and bonds

If you buy stocks of a company you are buying a share in that business. If you buy bonds from the same company you are essentially loaning them money for future payment. I am guessing (correct me if ...
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Government bonds - the most simple example

I would like to have an example of a common case of buying government bonds. (Wikipedia: it is issued generally with a promise to pay periodic interest payments and to repay the face value on the ...