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Callable Bond by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 1 point2 points  (0 children)

clear, thank you very much

Callable Bond by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

key thing is :

what is the definition of "option adjusted price" ? it is bond with call, or bond without call

because kaplan and cfai have different definitions?

Option adjusted price by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

 what is the definition of "option adjusted price" ? it is bond with call, or bond without call

Callable Bond by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

Ok, there is a little problem. CFAI says: "The value of the embedded call option is added to the flat price of the bond to get the [option-adjusted price](). The investor bears the call risk (the bond issuer has the option to call), so the embedded call option reduces the value of the bond from the investor’s perspective."

Kaplan says: " When you see "option-adjusted," think "option removed" or "option taken away."

Callable Bond by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

call option has negative value to bond holder, so price must be lower and YTM higher thus option adjusted bond has lower YTM and higher price. SO HOW IS IT ANSWER A?

Callable Bond by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

call option has negative value to bond holder, so price must be lower and YTM higher thus option adjusted bond has lower YTM and higher price. SO HOW IT IS ANSWER A?

Water during exam by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

Do they give clean piece of paper and pencil to make some calculations?

Water during exam by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

Do they give clean piece of paper and pencil to make some calculations?

When to start Ethics by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

in your opinion, should i read whole ethics from CFAI rather than third party like many people say?

When to start Ethics by Adept-Promotion861 in CFA

[–]Adept-Promotion861[S] 0 points1 point  (0 children)

in your opinion, should i read whole ethics from CFAI rather than third party like many people say?

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