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Securities which obligate the borrower/issuer to make payments on a fixed schedule. Fixed income securities include sovereign, corporate and municipal bonds, corporate loans, and securitized lending (e.g., ABS). "Fixed" refers only to the schedule of obligatory payments, not the amount, and may include inflation linked bonds, variable-interest rate notes, and the like.
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Valuation of Fixed-Income Securities
Bonds X and Y pay semiannual coupons. Then the cash flow for X is a single payment at the maturity of 3\$ (half of 6\$ since it's semiannual) plus the par value. The discounted cash flow has to equal …
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Valuation of Fixed-Income Securities
I wish I could "add a comment" to your answer but I can't for the moment.
Of course, the coupon for Y is 4\$ I corrected my answer. However, you are missing to square the denominator (because you are …