The inclusion of both clean and dirty prices provides asset managers the ability to distinguish between capital earnings (coming from the clean price
of a bond) and the interest earnings (coming from the coupon accruals) both for bonds and derivative instruments, providing a more holistic approach to valuation.
With this course you learn how to set up the cash flows for a bond, which will enable you to calculate the clean price
, the dirty price and yield to maturity.
Quotations of the corresponding clean price
, accrued interest, total price and consideration are, however, easily prepared.
For airlines who don't want to actively trade carbon emissions, a clean price
is perfect," said the Environment and CSR Manager of a major Northern European airline.
Yield prices can be calculated from clean prices
using either the Monaco formula or the RBA/RBNZ formula for Australia / New Zealand.
Bids are invited from the Primary Dealers in Treasury Bonds on the basis of clean prices
(exclusive of accrued interest from the date of issue of the series to the date of settlement).
The index of sovereign bond clean prices
Cbonds-GBI RU PI declined from 110.