Calculating the full price of a bond

When calculating the full price of a bond and the question does not specify the actual day convention or 30/360 convention, how will I know which one to use. MM states that if its a corporate bond to use the 30/360 convention. Also, in his video he mentions leap years and many other questions using the actual day convention incorporate months that have 31 days. This is embarrassing, but I do not know the specific months that have more or less than 30 days (other than February which has 28). Am I screwed for these types of questions; how do i proceed?

Use the knuckle trick for 30/31 day months! :+1:

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What I am saying is that I do not know which months have 30/31 days off the top of my head. So how can I expect to parry questions when I dont know what the numerator of t/T will be?

Of course, February is the exception to the rule.

They’re not going to give you incorrect answer choices that have the wrong number of days for a given month.

That’s not the point of the exam.

Wow, truly amazing. How did I make it to this age without this.

I was hoping you would show up. So if this is the case, should I default to the 30/360?

I would.

It will get you close enough to the correct answer.

There is also a BOND worksheet that lets you do either 30/360 or exact days for bond pricing!!! :bulb:


Dude, look at your calculator, use the [2ND] + [1] ==> [DATE] to calculate the number of days.

I’m the day counter master now!!!

DT1 input: 15.0819 ==> 15-August-2019. (I’m not using the american standard)

DT2 input: 25.1119 ==> 25-November-2019

Calculate DBD actual ==> 102 days

scroll down and you see it’s ACT, change it to 360 ==> 100 days

“30 days hath September, April, June and November, all the rest have 31 except February who stands all alone but leap year coming one in four” …or something along those lines (a poem i learned when i was younger to help me with days of the year)