4-2 Topics Covered S Bond characteristics reading the financial pages SBond prices and yields )Bond prices and interest rates → YTM VS. current yield 少 Rate of return iNterest rate risk 少 The Yield Curve Nominal and real rates of Interest → Default risk Irwin/McGraw-Hill CThe McGraw-Hill Commpanies, Inc, 2001©The McGraw-Hill Companies, Inc.,2001 4- 2 Irwin/McGraw-Hill Topics Covered Bond Characteristics ➔reading the financial pages Bond Prices and Yields ➔Bond prices and interest rates ➔YTM vs. current yield ➔Rate of Return ➔Interest Rate Risk ➔The Yield Curve ➔Nominal and Real Rates of Interest ➔Default Risk