Treasury Holding Period Yield

CFA Level I
#1

An investor buys a 10 3/8 treasury note for 103 11/32 and sells it one year later for 101 13/32. What is the holding period yield? A) 8.14%. B) 8.16%. C) 8.22%. D) 8.32%

#2

B) 8.16%.

#3

How did you get that

#4

101 13/32 - 103 11/32 + 10 3/8 / 103 11/32 101.406 - 103.343 + 10.375 / 103.343 B

#5

oh ok cool - I hate non-fraction numbers

#6

B

#7

projectplatnyc Wrote: ------------------------------------------------------- > oh ok cool - I hate non-fraction numbers very much agree.

#8

why do we have to add 10 3/8 in numerator? I had written in my notes: HPY = (endvalue - begin value)/begin value * 360/t

#9

that is the interest payment on the bond

#10

d1 = interest payment, the othet two are purchase price and face value