Finance
Value bonds and manage interest rate risk
When rates or the credit outlook move, price the bond's cash flows, then manage portfolio risk through the yield, the duration, the yield curve and the spread.
Your learning route
The program order
Complete the programs in order to finish the route. Each one brings short lessons, applied practice and a realistic business case together.
Plus and Pro members can create a verifiable Stratify certificate when the route is complete.
- Program 01
Bond markets and the shape of the contract
Foundational: you can read the cash flows and the split of risk that a bond contract writes down. By the end of this program you can say what face value, coupon, maturity and covenants each commit the issuer to, turn a stated coupon rate and a quoted price into dollars, and tell which side of the contract a call, a put or a conversion right belongs to.
- What a bond puts in writing
- Whose right, whose risk
Apply it: Closing case: set the terms of a first bond
4 lessons · ≈3 hours
- Program 02
Bond price, yield and time to maturity
Intermediate: you can move between a bond's price and its yield in both directions, and read the price of a trade that settles between coupon dates. By the end of this program you can compute a bond equivalent yield from a price, split a quoted price into its clean and accrued parts, and compare two bond alternatives on yield and on the cash actually paid at settlement.
- Why price moves against yield
Apply it: Closing case: choose between two bonds
4 lessons · ≈3 hours
- Program 03
Duration, credit risk and the yield curve
Advanced: you can model how an interest rate shock, the shape of the yield curve and a credit spread each move the value of a bond position. By the end of this program you can read duration as a price sensitivity, derive a forward rate from two spot rates, separate a promised yield from an expected return, and choose a defensible action when interest rate risk and credit risk build up in the same holding.
- Duration says more than maturity
- What the spread is saying
Apply it: Closing case: a shock on both axes
4 lessons · ≈4 hours