2 credits
Spring 2025 Lecture Upper Division
Introduction to fixed income securities. Discusses a variety of contracts-starting with pure discount bonds, coupon bonds, and callable bonds. Continues with options on bonds, caps, floors, and interest rate swaps. Introduces the theory of the term structure and present models for pricing fixed income securities. Topics include: spot and forward markets for debt instruments, simple models for interest rate risk management, duration, convexity, organized exchange-traded interest rate contracts, interest rate swaps, pricing relationships and the theory of the term structure, and single factor models for pricing interest rate claims.
Learning Outcomes1Identify how to value and hedge commonly traded fixed income securities.
2Demonstrate understanding of underlying economic determinants and behavior of fixed income securities.
3Outline and structure such securities.
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Attachments
made by Purdue students.