Question

9. (9 pts) A semi-annual coupon Corporate bond was purchased for settlement on November 18, 2017. The last coupon was paid on August 15, 2017. Using the 30/360 day count convention, answer the following questions:

a. on what date will the next coupon be paid?

b. how many days passed between the last coupon paid and the settlement date?

c. how many days are there in the current coupon period?

Answer 1

Solution :-

(a) The Next Semiannual Coupon will be Paid on 15th Feb , 2018

as the coupon paid after every 6 months = 15th Aug + 6 months = 15th Feb

(b) The Days Between last coupon date that is 15th Aug 2017 and Settlement date that is 18th Nov 2017

= 16 days of August + 30 days of September + 18 days of November = 64 Days

(C) The Days Left in the Current Coupon Period =

= 12 Days of Nov + 31 days of Dec + 31 days of Jan + 15 days of Feb = 89 Days