bond

[pbennett05]

Find the convexity of a 7-year maturity, 6% coupon bond selling at a yield to maturity of 8% The bond pays its coupons annually.
the first three years figure out the remaining 10. Take a look at the follow:
Time (t)
Cash flow
PV(CF)
t + t^2
(t + t^2) x PV(CF)
Basic Information:
Coupon 6
YTM 0.08
Maturity 7
Price $89.59
Table Data:
1 6 5.556 2 11.111
2 6 5.144 6 30.864
3 6 4.763 12 57.156
4 6
5 6
6 6
7 106
8 0
9 0
10 0
Sum:
Convexity: