i have to discount a coupon. what i need to do is to consider a coupon peroid before the bond started to be traded.
so for example, lets say that the bond started to be traded on 28/01/1999 and teh coupon is paid every 31/12 and 31/06
now i need to consider the peroid that was before - 28 days before the coupon was distributed.
i saw 2 ways to calculate it with a financial calulator. which one is the more correct one:
N= 180/360
C= (divide it by 2 , cause it is half a year)
I= (divide the discount rate by 2)
PV= 100
FV= press solve
or
N= 28/365
C= 0
I= whatever it is
PV= 100
FV= solve
so for example, lets say that the bond started to be traded on 28/01/1999 and teh coupon is paid every 31/12 and 31/06
now i need to consider the peroid that was before - 28 days before the coupon was distributed.
i saw 2 ways to calculate it with a financial calulator. which one is the more correct one:
N= 180/360
C= (divide it by 2 , cause it is half a year)
I= (divide the discount rate by 2)
PV= 100
FV= press solve
or
N= 28/365
C= 0
I= whatever it is
PV= 100
FV= solve