ep11: Yield curves - par curves, spot curves, bootstrapping...simple explanation

In this video I introduce the concept of yield curves - plots of yield to maturity for various times to maturity for instruments of a similar quality (and often same issuer)

I show how we can bootstrap a zero curve (spot curve) from a series of coupon paying instruments as long as we have one instrument on the yield curve that has only one cashflow remaining - this begins the bootstrapping process.

I explain how the spot curve can be used to discount the individual cashflows at the correct time/discount factor to arrive at a more accurate fair price for the bond, and then the YTM can be calculated from that price.

Видео ep11: Yield curves - par curves, spot curves, bootstrapping...simple explanation канала Matt Thomas