Bonds and Interest Rates Equation Formula Latex Code and Summary

Bonds and Interest Rates

Tags: #Financial #Economics

Equation

$$P(0, S) = \frac{1}{[1 + r(0, s)]^{s}} \text{or} e^{-r(0,s)s} \\ \text{Forward bond price} \\ F_{t,T}[P(T, T+s)] = \frac{P(t, T+s)}{P(t, T)} \\ P(t, T)[1 + r_{t}(T, T+s)]^{-s} = P(t, T+s)$$

Latex Code

                                 P(0, S) = \frac{1}{[1 + r(0, s)]^{s}} \text{or} e^{-r(0,s)s} \\
\text{Forward bond price} \\
F_{t,T}[P(T, T+s)] = \frac{P(t, T+s)}{P(t, T)} \\
P(t, T)[1 + r_{t}(T, T+s)]^{-s} = P(t, T+s)

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Introduction

Equation

$P(0, S) = \frac{1}{[1 + r(0, s)]^{s}} \text{or} e^{-r(0,s)s} \\ \text{Forward bond price} \\ F_{t,T}[P(T, T+s)] = \frac{P(t, T+s)}{P(t, T)} \\ P(t, T)[1 + r_{t}(T, T+s)]^{-s} = P(t, T+s)$

Latex Code

            P(0, S) = \frac{1}{[1 + r(0, s)]^{s}} \text{or} e^{-r(0,s)s} \\
            \text{Forward bond price} \\
            F_{t,T}[P(T, T+s)] = \frac{P(t, T+s)}{P(t, T)} \\
            P(t, T)[1 + r_{t}(T, T+s)]^{-s} = P(t, T+s)

Latex code for the Bonds and Interest Rates. The price of an s-year zero is P(0, S). The forward bond price formula $F_{t,T}[P(T, T+s)]$ is calculated as $F_{t,T}[P(T, T+s)] = \frac{P(t, T+s)}{P(t, T)}$ . And the non-continuous annualized rate is $P(t, T)[1 + r_{t}(T, T+s)]^{-s}=P(t,T+s)$ .

$P(0, S)$ : Price of an s-year zero.
$F_{t,T}[P(T, T+s)]$ : Forward Bond Price
$P(t, T)[1 + r_{t}(T, T+s)]^{-s}=P(t,T+s)$ : Non-continuous annualized rate

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