Finally , a teacher that explains the theory concepts and step by step instructions. I wish I had a teacher like you in my capital markets course! oh wait I do, thank you.
From a practical perspective, how do you get the zero-coupon rates that are the inputs? I know you can get the one-year Treasury spot since it has no coupons, but the 2-year and longer Treasuries all have coupons.
those are special instruments where "real" bonds are bought by banks which then "transform" them into new instruments which dont have coupon payments (e.g. they sell the coupons separeate from the actual bond, thereby creating a new security -> zero coupon bond)
In the equation, you take (1+ YTM). Thus, if the YTM = 0.035, then you would use 1.035 in the formula. Excellent point, I probably should have made this clearer.
Why are you squaring 1.0425? isnt that the rate over the 2 years, meaning you dont have to square it. And even when you calc this out.. you get 5% so when you add 3.5 + 0.5 =4. Which does not equal the 4.25%. Shouldnt 3.5 + f2 = 4.25?
Finally , a teacher that explains the theory concepts and step by step instructions. I wish I had a teacher like you in my capital markets course! oh wait I do, thank you.
This video popped up on my feed 3 years after graduating college and gave me the warmest feeling of never having to worry about this stuff again😂
thx, you explain it so much better and easier than the idiots of my university. Subbed.
@Peng Fu I'll read this comment section at least twice a year, now
Good lord, you didn't even use WORDS and you did a much better job than my textbook, thank you!!!
I had the video on silence on accident... and I still understood what was going on by just following your circles LOL
Great Video! We had such confusing notations in our course material. Your video cut the BS and got right to the core! Thanks!
Awesome. Thanks for watching!
I hope you are a blessed man wherever you are, thank you so much!!!!!!!!!
As a master student in finance this is way better than my book(my book is totally useless)
Thank you so much for helping me out. I was reviewing this content for my final test and this video saved my life!
You have made the calculation of forward rates very simple. Excellent presentation.
Such a beautiful explanation, tq sir ... Love from india ❤️
Very helpful thank you! This is a very concise way of explaining it!
I'm glad you liked the video. Thanks for the comment!
You're an excellent teacher. Thank you!
Thank you for the great explanation! It was amazing good clarification for my beginner studies of MsC in Finance!
Great. Thanks for watching!
love this channel
Thank you for your all beautifully explained videos.
Thank for putting this up. This is fantastic.
No problem Jon!
such a great channel
Very well explained, thank you for your time!!
Glad you enjoyed it!
80,000th sub, Just clicked and jumped. Congrats
Excellent explanation!
you're videos are so helpful! thankyou!
Thanks for the explanation, you really explain all in detail
Thanks for the video!
You bet!
Thanks! Very clear video... Helps with my Interest Rate Swap work.
Very helpful, thank you!
Sure thing!
Thanks, my uni can't explain this easily for some reason. Subbed.
Thank you this was really helpful!
what do you do for multiple years like implied 5 year forwar rate in five years?
Great explanation! You should make more videos.
That is a great video! Could you please also teach us how to calculate from Par to Zero coupon rate?
Thanks man! You saved the day! 🤗🙂
How often is interest on a forward rate swap paid?
Many thanks bro! Finaly I could understand this kind of rate.
Nice video, thanks for that, which software or app did you use to make the video?
Thank you, sir
From a practical perspective, how do you get the zero-coupon rates that are the inputs? I know you can get the one-year Treasury spot since it has no coupons, but the 2-year and longer Treasuries all have coupons.
those are special instruments where "real" bonds are bought by banks which then "transform" them into new instruments which dont have coupon payments (e.g. they sell the coupons separeate from the actual bond, thereby creating a new security -> zero coupon bond)
thank you!
But didnt zero bond mean that you only get the interest in the last year? In this equation we say that we get 4,25% in year 1 and year 2 or not?
Why couldn’t my textbook say it that well! Thank you!
No problem!
Thank you for sharing,but when you calculate f2 f3 f5 seems like a little mistake to put 1.035 equal to 0.035???
In the equation, you take (1+ YTM). Thus, if the YTM = 0.035, then you would use 1.035 in the formula. Excellent point, I probably should have made this clearer.
Really helpful!! Thx!
+Jenna Wang Sure thing! Take care :)
Thank you very much !!!
Can you explain the sum regarding forward contract cancellation & extension
Very nice. Thank you!
Awesome.
Professor, Could you share the concept of calculating the "forward 6-quarter rate." Thank you!!!
thank you, very clear
If we're using months instead of years, would n then be (number of months/12)?
Is this the same as calculating annuity?
Thank You !
Very clear!!!
so where in real life can you find yields for zero coupon bonds? what is an example of a zero coupon bond?
Why are you squaring 1.0425? isnt that the rate over the 2 years, meaning you dont have to square it. And even when you calc this out.. you get 5% so when you add 3.5 + 0.5 =4. Which does not equal the 4.25%. Shouldnt 3.5 + f2 = 4.25?
He also said in the video, it was off slightly due to rounding, but not sure if .25% is considered off slightly. This is 25 basis points!
THANK YOU
thank you you are the best!
Thanks!
Amazing.
Thanks!
you guys are trying but this formula will be used when (1+PD)/(1+pf) then all raised to power n
helpful!!
Make one with hedging
Screen not visible enough . Too dark.
Why the he’ll can’t the graduate professor explain it this way! The book sucks and the videos lectures are worse.