formulas Flashcards
Yield as a points
5.35 basis equals a yield of 5.35%
convexity measures
a bonds price sensitivity to large changes in market interest rates
Duration measures
a bonds price sensitivity to small changes in market interest rates
CABS DEBT limit calc
only the discount amount counts towards the debt limit
lease rental
equipment
Yield by bond type highest to lowest
taxable revenue bonds taxable go bonds treasuries revenue bonds go bonds
529 K-12 expenses
annual limit
10K
529 one time expense alotment
10K for student loans and certain apprenticeship programs.
NON OID bought in secondary market at a discount
How is gain treated
gain is ordinary income
For negotiated offerings, the retail order period is
determined by the issuer and is based on the order size; it
cannot be circumvented.
The New Issue Information Dissemination System (NIIDS) requires an underwriter to make any new issue
either
depository or DTC eligible. Therefore, the bonds will be able to be settled via NSCC.
The Bond Buyer Municipal Bond Index
published daily updated twice per month
the other indexes are published and updated weekly.
If the U.S. budget deficit is rising what is the economic impact
an increase in unemployment rates, rising inflation,
and rising interest rates
If the U.S. dollar increases against foreign currencies,
U.S. imports become more competitive and U.S. exports
become less competitive
If the U.S. dollar declines against foreign currencies
U.S. imports become less competitive and U.S. exports
become more competitive.
tightening money
effect on reserves
causes a decrease in reserves and a decrease in the money supply.
• A Municipal Securities Representative is NOT permitted to sell
municipal funds, trusts, or ETFs.
Any additional expenses resulting from a close-out must be forwarded to the appropriate party within
n five
business days of the date of execution of the close-out.
Customer account information must be maintained for
six years after the account is closed
investment objective of speculation.
• An investor whose portfolio consists of high-yield municipal bonds, equity securities, futures, and options
time frames for syndicate disclosure of
Allocation?
Priority provisions and reasons for changes, the issuer’s retail order period, and all designations that
are paid out within?
• The syndicate manager must disclose to other members of the syndicate the allocation of bonds within 24
hours, the priority provisions and reasons for changes, the issuer’s retail order period, and all designations that
are paid out within 10 business days of the date of sale.
current yield
annual coupon/current price
yield to put
all interest and principal amount
direct debt
all debt including notes
net direct debt
all issues minus self supporting (revenues)
total bonded debt
all short and long term debt pluc overlapping debt
Municipal Note Interest
Paid
paid at maturity
Debt service coverage ratio
net revenue over debt servic
triangle
Price > NY > CY > YTM
Taxable equivalent Yield
muni yield / (1-tax bracket)
Net Yield
Taxable yield * (1 - tax bracket
accretion calculation
Multiply offering price by half the YTM then subtract the actual interest received then add the total to the price.
Calculation for the next six months is done the same way only using the new accreted price.
diminimus
.25% of the principal multiplied by the number of years to maturity.
Under writer assessment
.00275% or .0275 per 1000
transactions
.001 or 1 cent per 1000 of par
Net interest cost
Total interest divided by bond year dollar amount
