NCU Finance Valuation of Bond Prices and Interest Rates Presentation

For this assignment, you will examine some important theories and concepts associated with interest rates. Safe investments usually have fixed interest rates. You have been asked to assemble this presentation for a weekly staff meeting, so your audience will be senior managers and a couple of vice presidents.

Note their interest in this topic is very high so you need to be very succinct and clearly explain the risks and rewards of building a successful portfolio. In reference to term structure, interest rate risks, and duration supported by numerical illustration where applicable, in a recorded PowerPoint presentation, evaluate the following:

1. The pricing of bonds, the calculation of the bond yield, and how bond prices adjust across time for premium, par, and discount bonds.
2. An evaluation of the yield curve and the theories to explain the shape. Discuss how these theories can be helpful in bond investing.
3. The interest rate risk for bond investments. Form a graphical presentation of the concepts.
4. The concept of duration and how it is useful in the context of bond portfolio analysis. You want to clearly discuss both the price risk measurement value for the duration as well as how duration can measure the dynamics of price and reinvestment rate risk across time for a bond portfolio.